Business activity in Uganda’s private sector continued to expand in August, albeit at a slower pace, according to the latest purchasing managers’ index produced by S&P Global.
The Stanbic Bank Uganda Purchasing Managers’ Index, a measure of the health of the private sector, fell to a four-month low of 53.3 in August, from 53.6 in July. Readings above 50 indicate an improvement in business conditions compared with the previous month, while readings below 50 show a decline.
The expansion was supported by strong demand conditions and an increase in new orders, S&P said. This led to a rise in new sales, which companies also attributed to successful advertising and marketing campaigns.
The survey showed that the jump in new orders and output was observed across all sectors.
Hiring increased in all sectors except manufacturing, where it remained unchanged. This marked the seventh consecutive month of growth in staffing numbers.
In order to support the processing of new orders, firms purchased more inputs and built up safety stocks, S&P said. Consequently, work backlogs were depleted for the seventh time in eight months.
Companies also reported an increase in input prices, driven by higher utility, wage, and raw material costs. These increased costs were then passed on to customers in the form of higher selling prices. Despite falling input prices in agriculture and construction, output prices rose across all sectors.
