Kenya's private sector activity contracts in July at steepest rate in a year

Nairobi. Kenya's private sector contracted at the fastest pace in a year in July as input prices rose and protests disrupted some businesses, a survey showed on Tuesday.

The Stanbic Bank Kenya Purchasing Managers' Index fell to 46.8 in July from 48.6 a month earlier. Readings above 50.0 indicate growth in business activity, while those below that signal contraction.

"The decline was largely concentrated in the manufacturing and services sectors, conflicting with higher output across agriculture, construction and wholesale & retail," Stanbic said in comments accompanying the survey.

"Businesses reportedly curbed their output because of lower sales volumes, cash flow problems, political unrest and accelerating inflationary pressures."

July's PMI reading marked the steepest drop in operating conditions since July 2024.

In early July, at least 31 people died in demonstrations in Nairobi and other towns held to mark the 35th anniversary of the country's first major pro-democracy rallies seeking an end to single-party rule.

Kenya's consumer inflation rose to 4.1 percent year-on-year in July, compared with 3.8 percent the previous month, data from the statistics office showed.