- Rise in prices of petrol, diesel and kerosene had a knock-on effect on prices of other goods and services.
- Findings based on Markit Stanbic Bank Kenya Purchasing Managers’ Index (PMI).
Activity in Kenya’s private sector grew only very slightly in September, hurt by rising energy prices that hit demand and also led to higher input costs, a survey showed on Tuesday.
The Markit Stanbic Bank Kenya Purchasing Managers’ Index (PMI) slid to 50.4 in September from 51.1 a month earlier. The 50.0 mark separates growth from a contraction in activity.
“Rising living costs weighed on consumer spending and new orders. The hike in energy prices particularly hit demand, as well as driving a sharper rate of both input cost and output charge inflation,” Stanbic Bank Kenya said in comments accompanying the survey.
In mid-September, the energy regulator raised the maximum prices of petrol, diesel and kerosene, which had a knock-on effect on prices of other goods and services.
“Firms hiked output prices to protect their profit margins following a rise in fuel prices during the month,” Kuria Kamau, fixed income and currency strategist at Stanbic Bank Kenya, said.
In late September, Kenya’s central bank held its benchmark lending rate at 7.0%, and its monetary policy committee said it had taken note of emerging local and global inflationary pressures.