A closely watched measure of activity in Uganda’s private sector rose to a four-month high in November as customer demand strengthened.
The Stanbic Bank Uganda purchasing managers’ index, a measure of the health of the private sector, jumped to 53.4 in November, up from 52.4 the previous month, S&P Global said Tuesday. It is the thirteenth straight month that the indicator has been above the 50 mark that separates expansion from contraction.
Managers reported an increase in the number of customers, with new orders rising for the 16th consecutive month. To meet the increase in new orders, output rose in all sectors except wholesale and retail trade.
Christopher Legilisho, economist at Stanbic Bank, said:
“Uganda’s PMIs for November posting strong activity implies a continuing trend of sustained growth in private sector activity, with both output and new orders rising for a sixteenth consecutive month due to solid consumer demand. Hiring increased for an eighth month running, with firms taking on more temporary staff to cope with increasing orders and purchasing activity, as well as to clear backlogs. Of the surveyed sectors, all but agriculture caught up on work outstanding.
“Business confidence in the outlook for customer demand and production over the next 12 months is high across all sectors. Indeed, Ugandan firms have increased their purchasing volumes to meet robust customer demand. However, supplier delivery times remain a sticky issue due to poor weather conditions and delayed payments.”
Input costs rose during the month, driven by higher fuel prices, utility costs and prices for food and stationery. As a result, firms raised selling prices for the eighth month in a row. Industry, services, wholesale and retail trade reported increases in input costs, while agriculture and construction reported decreases.
