NewsEast & Horn AfricaKenya private sector activity jumps in April - Markit

Mon,10Dec2018

Posted on Friday, 04 May 2018 09:33

Kenya private sector activity jumps in April - Markit

By Reuters

Kenya's President Uhuru Kenyatta, left, shakes hands with opposition leader Raila Odinga, right, in Nairobi, Kenya, March 9, 2018. Photo: Brian Inganga/AP/SIPAKenya's private sector activity jumped in April, continuing its recovery after months of slowdown last year due to a prolonged and volatile election period, a survey showed on Friday.

The Markit Stanbic Bank Kenya Purchasing Managers' Index(PMI) for manufacturing and services rose to 56.4 in April from 55.7 in March. Anything above 50 denotes growth; anything below, contraction.

"The strength of the recovery in private sector activity continued last month. This shows that the underlying demand conditions in the economy are consistent with a solid recovery in economic activity," Jibran Qureishi, regional economist for East Africa at Stanbic Bank said.

Output is up for the fourth month in a row as new orders rolled in from both local and foreign markets.

However, the survey cautioned on the prospect of inflation rising in coming months.

Promise to unite the country

"The combination of rising demand, both domestic and external, with rising input costs and rising employment have the potential to exert meaningful and durable upward pressures on inflation," Qureishi said.

Kenyan inflation eased to 3.73%  in April year-on-year from 4.18% last month, the latest data from the statistics office showed. The rate is at its lowest level since January 2013.

In October, the PMI dropped to 34.4, its lowest level since the series began in January 2014, after the opposition boycotted a repeat presidential election ordered by the Supreme Court.

President Uhuru Kenyatta was declared the winner and he was sworn into office for a second term at the end of November.

In late January, opposition leader Raila Odinga conducted a symbolic "swearing in" which the government has said was illegal.

Kenyatta and Odinga have since reconciled and promised to unite the country after the elections in which around 100 people were killed mainly in clashes between opposition supporters and security forces.

The Finance Ministry forecasts economic growth will rebound to 5.8% growth in 2018, from 4.9% last year.



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