Nairobi, Jan 6 – Kenya’s private sector closed 2025 on a strong footing as business activity expanded for a fifth consecutive month, driven by robust customer demand and increased hiring, a closely watched survey showed.
The Stanbic Bank Kenya Purchasing Managers’ Index stood at 53.7 in December, easing from 55.0 in November but remaining firmly above the 50.0 threshold that separates growth from contraction.
Firms reported a marked increase in output, new orders and purchasing activity, while employment growth accelerated to its fastest pace since November 2019. The improvement reflects growing confidence among businesses as demand conditions remained supportive toward year-end.
“The Stanbic Bank Kenya PMI stayed in expansion territory, albeit slower this month, implying still strong demand conditions are driving new orders,” said Christopher Legilisho, an economist at Stanbic Bank Kenya.
Inflationary pressures picked up from November’s lows, with companies citing higher fuel, materials and tax-related costs. Despite the reacceleration, input price inflation remained below its long-term average, suggesting cost pressures are still contained.
Businesses increased inventories and purchases to improve delivery times, with supplier performance reaching its best level since September 2021. Faster delivery times helped firms meet demand and maintain competitiveness.
Looking ahead, business sentiment for 2026 remained positive, supported by plans for investment, diversification and increased marketing. However, survey respondents cautioned that stronger demand could translate into higher inflation in the coming months as confidence continues to improve.
