Kenya Private Sector Activity Softens in June, But Still Weak Since Mid 2016

Kenya Private Sector Activity Softens in June

Export Processing Zones Authority Shona factory in AthiRiver

Kenyan service providers signaled a moderate rebound in business activity in June, but output and new orders deteriorated further a private survey showed on Friday.

The rebound was attributed to a reduction in curfew hours that helped many businesses to increase operating hours and reopen premises.

In addition, the relaxed measures in Europe led to a slight improvement in export demand that was the first since February. 

According to the Markit Stanbic Bank Kenya Purchasing Managers’ Index (PMI) stood at 46.6 in June, rebounding from May’s 36.7 but staying below the 50 mark separating expansion from contraction.

The report also found out that  firms still saw a drop in customer demand overall due to a reluctance to travel.”

“A resumption in cargo flights in addition to the gradual re-opening of economies around the world, is underpinning external demand,” said Jibran Qureishi, the head of research for Africa at Stanbic Bank.

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“However, the damage done by COVID-19 could last for the better part of the next six months, notwithstanding what official growth statistics may indicate.”