Kenya’s private sector growth remained stable in February, with the PMI increasing from 50.5 to 50.6. The agriculture, manufacturing, and construction sectors drove growth, but wholesale, retail, and services saw declines. Only 5% of companies surveyed expect output to rise in the coming year, with a predicted economic growth of 5.3% in 2025 and 2026.
In February, Kenya’s private sector demonstrated steady growth, maintaining a similar expansion rate as in January, according to a recent survey. The Stanbic Bank Kenya Purchasing Managers’ Index (PMI) increased slightly from 50.5 to 50.6, indicating ongoing activity, as values above 50.0 reflect growth.
The survey highlighted variations across sectors, noting that growth in output and new business was primarily driven by agriculture, manufacturing, and construction. In contrast, wholesale, retail, and services sectors experienced downturns. According to Stanbic Bank, “Sector divergences were apparent… with output and new business growth driven by agriculture, manufacturing and construction. Meanwhile, wholesale & retail and services firms recorded declines.”
Despite the modest overall growth rate, the outlook remains cautious among surveyed firms, with only 5% anticipating an increase in output over the next 12 months. Positivity was noted in three out of five sectors monitored: construction, wholesale, and retail services, as reported by Stanbic Bank.
Looking ahead, the finance ministry projects the economy will grow by 5.3% in both 2025 and 2026, reflecting an acceleration from an estimated 4.6% growth in the previous year. The expectations suggest a potential rebound, albeit amid current concerns over business sentiment.
In summary, while Kenya’s private sector showed slight growth in February according to the Stanbic Bank’s PMI, there are notable disparities across different industries. Despite an optimistic long-term economic forecast, firms exhibit a cautious outlook regarding future growth due to challenges faced in certain sectors such as wholesale, retail, and services.
Original Source: money.usnews.com
