The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | JULIUS BUSINGE | The Stanbic Bank Purchasing Managers’ Index (PMI) has posted 56.6 in October up from 54.2 in September, recording above the 50.0 no-change mark for the 21st successive month.
This reading is the highest since the survey began in June 2016. Four of the five monitored sectors saw business conditions improve in October with the exception of industry.
New orders continued to expand at the start of the fourth quarter of 2018, extending the current sequence of growth which began in February 2017.
The latest rise was attributed to higher customer numbers and improving demand in the economy. Jibran Qureishi, the regional economist for East Africa at Stanbic Bank said the Ugandan economy remains on course to grow above 6.0% in 2018.
“Good rains expected in the fourth quarter could support the agrarian sector and subsequently economic activity… despite rising output costs for firms, the strong momentum of domestic demand is counter balancing this,” he said.
Alongside higher purchase prices and staff costs, respondents also noted increases in prices for fuel, water and electricity.
This resulted into higher prices for materials such as food, ink and stationery. Despite increases in new orders, backlogs of work continued to decrease due to the expansion of workforce numbers.
Employment has risen throughout the 29-month survey history mainly in agriculture, construction and services sector staffing levels in the latest survey period.
Stanbic’s head of fixed income Benoni Okwenje said Ugandan companies raised their purchasing activity for the eighth successive month in October, linked to rising new orders.
He said this is interesting because it indicates Ugandans’ purchasing power is still strong in spite of inflation.
The survey is sponsored by Stanbic Bank and produced by IHS Markit. It covers the agriculture, industry, construction, wholesale & retail and services sectors.
