Dry weather forces fall in economic activity
Drop in agricultural productivity due to dry weather conditions coupled with rising cost of production has seen a drop in economic activities, according to the Stanbic Bank’s Purchasing Managers Index (PMI).
Kampala. Drop in agricultural productivity due to dry weather conditions coupled with rising cost of production has seen a drop in economic activities, according to the Stanbic Bank’s Purchasing Managers Index (PMI).
The report, covering the month of March, saw a drop in Purchasing Managers Index for the month from a score of 54.4 in February to 51.7.
The Purchasing Managers Index (PMI) is used as an indicator of economic activity. It is a reflection of how many purchasing managers have reported better than normal business conditions in any given month.
A figure of 50 is average anything below 50 means the economy is contracting.
Although the PMI for March registered a score of 51.7 in March, surveyors said the reading still points to improvement in business activity which continued to rise at the end of the first quarter of the year.
Mr Jibran Qureishi, the Stanbic Bank regional economist for East Africa said: “The decline in the PMI, similar to last month is mainly due to weaker agricultural productivity owing to the dry weather conditions,” he said. But he was optimistic that the economic activity will pick in April. However, Stanbic said there had been a pickup in hiring with companies recruiting new staff.
Mr Benoni Okwenje, the Stanbic Bank Fixed Income Manager said: “We are optimistic economic activity is going to continue picking up as survey findings indicated Ugandan companies raised purchasing activity in advance of expected output growth in the coming months.
About PMI
PMI is used as an indicator of economic activity. It is a reflection of how many purchasing managers have reported better than normal business conditions in any given month.
