The latest purchasing managers’ index data shows that Kenya’s private sector contracted for the fifth consecutive month in August due to elections.
The S&P Global Kenya Purchasing Managers’ Index (PMI) dropped 44.2 in August from 46.3 a month earlier.
For the fifth consecutive month, the headline PMI registered below the 50.0 neutral mark in August, dropping to 44.2 from 46.3 in July.
The reading was the lowest seen since the lockdown-hit period in April 2021.
“The election had a notable toll on economic activity during August. Output fell steeply and at the quickest pace for 16 months, with the construction sector seeing the greatest decline,” the survey noted.
“Looking ahead, the trajectory of underlying cost pressures could depend on the timing of the removal of fuel subsidies in addition to the upcoming short rain season, which will be key for food inflation,” Mulalo Madula, Economist at Stanbic Bank commented.
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