"Panelists frequently mentioned that lower demand due to rising prices and a lack of cash flow had led to the drop in activity," S&P Global said in comments accompanying the survey. (Reporting by George Obulutsa; Editing by Toby Chopra)
george.obulutsa.thomsonreuters.com@reuters.net)) NAIROBI, March 3 (Reuters) - Kenya's private sector
activity contracted in February, weighed down by a steep
weakening of the shilling, inflationary pressure on consumer
spending and growing tax burdens for firms, a survey showed on
Friday.
The S&P Global Kenya Purchasing Managers' Index (PMI) fell
for the first time since October to 46.6 in February from 52.0 a
month earlier. Readings above 50.0 signal growth in business
activity, while those below that point to a contraction.
Survey respondents attributed the drop to higher import
costs after the currency depreciated and "reports of tax
burdens", which drove up costs, said Mulalo Madula, an economist
at Stanbic Bank, which is involved in the survey.
"The increase in input costs and consequently output
charges... is amongst the highest since the series began in
2014," she said.
The shilling , which has been breaching a series of
record lows for months, is down 3% versus the dollar so far this
year, having weakened 9% last year.
Inflation rose to 9.2% in February from 9.0% a
month earlier.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.