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Citizen Posts
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Kampala: The monthly Stanbic Purchasing Managers’ Index (PMI), which provides a measure of prevailing private sector outlook, dropped to 53.1 during December compared to the 55.7 reading posted in November.
Christopher Legilisho, Economist at Stanbic Bank said, “Stanbic Bank Uganda PMI data for December reveals sustained strong private sector growth, with businesses budding in optimism about present and future economic conditions. Private sector business conditions expanded for the ninth consecutive month due to strong sustained customer demand resulting in an expansion in output and new orders despite a dip in employment for a second month in a row.”
He said, “The uptick in new order growth occurred across the board, reflecting the acquisition of new clients and an improvement in consumer purchasing power. Consequently, there was an increase in backlogs during the month. Firms ramped up their purchasing activity and inventories to accommodate for strong demand.”
The Stanbic PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers of around 400 local private sector companies. The sectors covered by the survey include agriculture, mining, manufacturing, construction, wholesale, retail and services.
Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a negative outlook. The PMI is a weighted average of the following five indices: New Orders (30%), Output (25%), Employment (20%), Suppliers’ Delivery Times (15%) and Stocks of Purchases (10%).
Central to the latest strengthening in the health of the private sector were further increases in both output and new orders in December, in each case extending the current periods of expansion to nine months.
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