A key gauge of activity in Uganda’s private sector edged up in September after slowing in August, as agriculture swung to expansion after contracting in August, meaning all five sectors covered by the survey improved, according to analytics group S&P Global.
The Stanbic Bank Uganda purchasing managers’ index rose to 52.9 in September from 51.6 in August, marking the eleventh consecutive month of expansion. A reading above 50 indicates expansion in activity, while a reading below 50 indicates contraction.
Output and new orders rose for the fourteenth consecutive month, which the survey attributed to “resilient customer demand and effective marketing strategies”. This led to an increase in employment and purchasing activity.
“Private sector hiring increased for the sixth month, with firms hiring more staff to handle rising orders and purchasing activity, as well as to clear backlogs,” said Christopher Legilisho, an economist at Stanbic Bank.
Input costs continued to rise, with purchasing managers reporting higher labour costs and prices for construction materials, fuel and utilities. However, firms capitalised on the robust demand climate to pass on costs to customers, resulting in higher selling prices for the sixth consecutive month.
“However, some firms in agriculture reduced charges as good weather increased food availability countrywide,” Mr Legilisho said.
