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Kenya PMI April 2023

Kenya: Private-sector PMI falls in April

The S&P Global Purchasing Managers’ index (PMI) fell to 47.2 in April from March’s 49.2. As such, the index fell further below the 50.0 no-change threshold, signaling a sharper deterioration in private-sector operating conditions compared to the previous month.

The decline was driven by sharper falls in new orders and output and a deterioration in purchasing activity, amid weak demand. However, employment experienced its most rapid growth in 2023. Regarding prices, input costs rose at the slowest rate in four months due to weak demand and a better availability of goods. However, price pressures were still elevated, due in part to the depreciation of the shilling.

On the outlook for business activity, Mulalo Madula, economist at Standard Bank, commented:

“The outlook for output for the upcoming 12 months significantly decreased, reaching the lowest level since the survey’s inception. This was largely due to worries about the effects of high inflation as power tariffs were increased by around 19% in April. […] overall year-on-year inflation is likely to slow, having fallen to 7.9% in April from 9.2% in March, as statistical base effects continue to unwind, although underlying costs for firms are likely to remain elevated.”

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