Business activity weakens in August as price of raw materials soar
Kenya’s business activity weakened in August as the headline Purchasing Managers’ Index fell to 49.7 from 51.3 recorded in July due to rising costs of raw materials and reduced stock purchases. According to Stanbic Bank PMI readings, while firms recorded higher sales volumes for three consecutive months to August this year, companies struggled to purchase […] The post Business activity weakens in…
Kenya's business activity slowed in August as the cost of raw materials rose and firms' purchasing power decreased, according to the latest Purchasing Managers' Index (PMI) from Stanbic Bank. The PMI dropped to 49.7 from 51.3 in July, indicating a deterioration in the private sector's conditions. Despite recording higher sales volumes for three consecutive months, companies faced challenges purchasing inputs due to rising prices and limited liquidity.
Economist Christopher Legilisho noted that while new orders remained resilient, output declined for the sixth consecutive month due to supply shortages of key materials. The mismatch between output and new orders was attributed to high inflation and limited liquidity. Nonetheless, Stanbic Bank noted an increase in employment as firms hired additional staff to fulfill backlogged orders, suggesting that demand may remain robust despite the challenges.
Written by urgent.news from KBC's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
