Business Confidence Wanes in 2022 for Kenyan Firms

Companies in Kenya are less optimistic that the country’s economic growth will gain traction in 2022, according to the latest PMI data besides witnessing an expansion to a 14-month high in December. 

The Stanbic Bank Kenya Purchasing Managers Index-PMI says the pace of growth was the strongest seen since October 2020 on improving customer demand and better cash flow as economic conditions recovered further from pandemic measures.

The headline figure derived from the survey is the Purchasing Managers’ Index™ (PMI). Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration.

“Both domestic and export demand expanded rapidly on account of fewer public health restrictions, locally and around the world. Export firms particularly noted increased demand from Europe and parts of Africa,” noted Stanbic Bank Fixed Income and Currency Strategist Kuria Kamau.

However, “Despite this, the 12-month outlook as reported by firms fell to the lowest level on record with most firms expecting business conditions to remain largely the same in 2022.”

“In fact, the level of sentiment was the weakest seen since the survey began in January 2014, with just 19 per cent of respondents giving a positive outlook.”