Kenya’s private sector expands in August, according to the PMI

According to a study released on Wednesday, Kenya’s private sector activity increased in August as businesses rebounded from the interruption created by anti-government protests the previous month.

August saw a rise in the Stanbic Bank Kenya Purchasing Managers’ Index from 43.1 to 50.6. Activity is shown by readings above 50.0, indicating expansion, and below 50.0, signaling contraction.

In remarks that accompanied the survey, Stanbic Bank Kenya stated, “The Stanbic Bank Kenya PMI indicated a mild recovery in business conditions during August as the impact of protests faded, allowing firms to broadly resume normal operations.”

The July number decreased from 47.2 in June, which was indicative of the impact of anti-government protests that both months had on some corporate activity.

After fatal street protests in June, President William Ruto vetoed the government’s annual financial package, which included tax hikes totaling 346 billion shillings ($2.69 billion).

“Output increased across three of the five broad sectors covered by the survey, with renewed growth in services, wholesale & retail and construction,” said Stanbic Bank Kenya.

“By contrast, there were declines in activity across manufacturing and agriculture.”

The majority of respondents to the study expressed pessimism about the state of the economy over the next 12 months, and only 5% of businesses stated they anticipated growth. This portrayed a bleak picture of the situation.

According to Christopher Legilisho, an economist at Stanbic Bank, “business expectations worsened in August, implying firms as less hopeful about output over the next 12 months.”