Private-sector activity drops to four-month low, PMI shows

Kenya’s private-sector activity grew at the slowest pace in four months in October, weighed down by softer domestic demand, a survey showed on Thursday.

The Markit CFC Stanbic Kenya Purchasing Managers’ Index (PMI) stood at 52.0 last month, down from 53.5 in the September, although still above the 50.0 mark that separates growth from contraction.

“Domestic demand evidently seems to have cooled off. New export orders rose at its fastest pace in six months, hence the fall in output was clearly related to conditions in the domestic market,” said Jibran Qureishi, regional economist for East Africa at CFC Stanbic Bank.

He said uneven rainfall around the country may subdue farm output in the months ahead, and slower private-sector growth could also curb expansion by companies.

Kenya’s economy expanded by 6.2 percent in the second quarter of this year, up from 5.9 percent in the same period a year ago, mainly because tourism rebounded.