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Kenya's Private Sector Slows in February Amidst Economic Headwinds
4 Mar
Summary
- Private sector activity expanded slower in February, Stanbic PMI fell to 50.4.
- Agriculture and manufacturing sectors saw slowing performance in February.
- Kenya's finance ministry forecasts 5.0% economic growth for 2025.
Kenya's private sector experienced a slowdown in expansion during February, as indicated by the Stanbic Bank Purchasing Managers' Index (PMI) which decreased to 50.4 from 51.9 in January. While this still signifies growth, certain sectors faced headwinds.
The agriculture and manufacturing industries reported a deceleration in their performance. Conversely, the construction, wholesale, retail, and services sectors demonstrated robust growth, helping to sustain the overall expansionary trend.
Economist Christopher Legilisho noted that increased competition and economic uncertainty impacted businesses. Although macroeconomic conditions have seen improvements, the broader economy has yet to fully realize these benefits, with parts of the private sector still under strain.
The finance ministry anticipates continued economic growth, projecting a 5.0% expansion for 2025 and an even stronger 5.3% for the current year, building on a 4.7% growth in 2024. Inflation also saw a slight decrease, slowing to 4.3% year-on-year in February.
