The PMI has now remained above the 50 mark for eight consecutive months, indicating a positive outlook.
“The Stanbic Bank Uganda PMI data for November revealed a vibrant private sector growing in optimism about both current and future economic conditions,” said Christopher Legilisho, Economist at Stanbic Bank.
“The PMI rose to 55.7, which is an extension in business conditions for an eighth consecutive month due to strong, sustained customer demand resulting in an expansion in output and new orders despite a dip in employment.”
The survey, compiled by S&P Global, covers various sectors including agriculture, mining, manufacturing, construction, wholesale, retail, and services.
All five monitored segments recorded expansions in business activity and new orders, with demand conditions reportedly strengthening.
Firms increased their input buying in response to increased new business and hopes of future expansions in client demand.
However, employment levels fell in November across all surveyed sectors, as firms targeted cost containment amid reduced work backlogs.
“Input and output price pressures increased due to high utility and energy bills,” Mr Legilisho said.
“Further, purchase prices increased due to higher costs for construction materials, food, and toiletries.”
Despite the challenges, firms remain positive about the economic outlook due to planned investment and expectations of strong consumer demand conditions over the coming year.
The PMI data also showed that Ugandan businesses raised their selling prices for the third month running in November.
However, construction companies did not increase their prices.
Input buying grew again midway through the fourth quarter, facilitated by an improvement in suppliers’ delivery times.
Ugandan companies were able to build desired safety stocks amid hopes of further upturns in new orders in the coming months.
