Business activity picked up in April after a month of falls in output and new orders, as demand firmed, a closely watched survey showed Monday.
The Stanbic Bank Uganda purchasing managers’ index, which tracks monthly changes in private sector activity, rose to 52.6 in April from 49.3 in March. This was above the neutral level of 50, which indicates that a majority of firms reported an expansion in business activity.
“Output and new orders recorded an uptick during the month due to a resurgence in customer demand,” said Christopher Legilisho, economist at Stanbic Bank. “Among the sectors surveyed, only the agricultural sector recorded a decline. The streak of employment gains continued for a 13th month, helping to clear backlogs of work.”
The increase in new business meant that firms increased their purchasing activity and, as a result, their inventories. In addition, they hired more workers to reduce order backlogs and meet new demand.
“Increases in staff and purchasing costs following higher raw material prices and higher starting salaries for new hires pushed up overall input prices at the start of the second quarter,” the survey said. Business costs have risen in each of the past 33 months, it added.
