The Stanbic monthly Purchase Managers Index (PMI) has continued to project a healthy performance in the private sector for the 26th month running.

Stanbic PMI indicates growth in output rises for twenty-sixth month running

The Stanbic monthly Purchase Managers Index (PMI) has continued to project a healthy performance in the private sector for the 26th month running.

Although the PMI for March registered a score of 51.7 in March down from 54.4 in February, the reading still points to improvement in business activity which continued to rise at the end of the first quarter of the year in response to greater customer demand.

Explaining the survey findings Jibran Qureishi, Regional Economist E.A at Stanbic Bank said: “The decline in the PMI, similar to last month is mainly due to weaker agricultural productivity owing to the dry weather conditions. That said, delayed payments both from the public and private sector continue to hold back domestic demand. In any case, activity should start to pick up as the long rains potentially come through in April.”

However, some panellists surveyed reported particularly strong growth of construction activity. Alongside construction, output also rose in the industry, service and wholesale & retail sectors. Only agriculture saw a drop in activity during the month.

According to the March PMI report findings, rising customer requests led to another monthly increase in new orders, although some panellists reported signs of demand has softened in the latest survey period. Companies responded to greater output requirements by taking on extra staff. Higher operating capacity and reports of improved workforce efficiency contributed to further depletion of outstanding business.

Commenting on the performance for March, Benoni Okwenje Stanbic 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 coming months. However, the level of inventories decreased for the first time in a year as inputs were used to support current increases in business activity.”

Overall input costs rose on the back of higher electricity and water bills alongside rises in both purchase and staff costs. Where purchase prices increased, respondents noted higher costs for materials such as food products and stationery, as well as rising land prices.

Firms responded to higher cost burdens by raising their output prices accordingly. Charges have increased throughout the 34 months of data collection so far, with only industry lowering selling prices in March.


The survey, sponsored by Stanbic Bank and produced by IHS Markit, has been conducted since June 2016 and covers the agriculture, industry, construction, wholesale & retail and service sectors. The headline figure derived from the survey is the Purchasing Managers’ Index™ (PMI™) which provides an early indication of operating conditions in Uganda.

The PMI is a composite index, calculated as a weighted average of five individual sub-components: New Orders (30%), Output (25%), Employment (20%), Suppliers’ Delivery Times (15%) and Stocks of Purchases (10%). Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show deterioration.