Kenya PMI Signals Business Upturn as Orders Grow and Prices Climb
KENYA · ECONOMY
Key Facts
- —The country Kenya is an East African country on the Indian Ocean, and its capital Nairobi is the region’s business hub.
- —What happened On Monday 5 October 2026, the monthly Stanbic Bank Kenya PMI business survey showed a reading of 51.3 for September.
- —Why it matters A reading above 50 means business conditions improved, after August’s reading of 49.7 sat just below that line.
- —What drove it New orders rose for a fourth month, helped by stronger demand, referrals, marketing and cash injections.
- —The catch Output still fell for a seventh month, as fuel, transport and farm costs held production back.
- —Prices About 30% of firms paid more for inputs, and selling prices rose at the fastest pace since June.
- —The wider picture Official inflation rose to 6.8% in September from 6.6% in August, with transport prices up 15.6%.
Kenya’s private sector improved modestly in September, as stronger customer demand lifted new orders. The Stanbic Bank Kenya PMI, a monthly survey of about 400 firms, rose to 51.3 from 49.7 in August.
The survey, released on Monday 5 October 2026, also carries a catch: output fell again and prices are rising faster. For investors and visitors, it points to a Kenyan economy with healthy demand but climbing costs.
What the Kenya PMI Measures
A purchasing managers’ index (PMI) asks company buyers whether business got better or worse than the month before. A reading above 50.0 signals improvement, and a reading below 50.0 signals deterioration.
S&P Global, a New York-listed data firm, compiles the Kenya PMI for Stanbic Bank Kenya. The lender belongs to South Africa’s Standard Bank Group, and the survey has run since January 2014.
The panel covers about 400 private companies in farming, mining, manufacturing, construction, wholesale, retail and services. September’s answers were collected between 10 and 28 September 2026.
The headline index blends five parts: new orders, output, employment, supplier delivery times and stocks of purchases. New orders carry the most weight, at 30%.
Orders Rise, but Output Still Slips
The index climbed to 51.3, back above the 50.0 line. S&P Global called it a modest improvement, the strongest since January and level with July.
New orders grew for a fourth month in a row, and faster than in August. Firms credited better market demand, customer referrals, marketing campaigns and cash injections.
Output, the actual volume of business activity, fell for a seventh straight month. The drop was only slight, and the smallest in that run.
Companies said high costs held back production, and some cut output because farm goods were scarce. Others were encouraged by improving sales and recovering cash flow.
Firms bought more inputs for the first time in five months and built up stocks for the first time since June. Employment rose again, as workloads and unfinished orders grew.
Manufacturing, construction and services expanded, according to Christopher Legilisho, an economist at Stanbic Bank. Agriculture, wholesale and retail “remained under pressure”, he said.
Costs and Prices Climb Faster
Around 30% of firms reported higher input costs in September, while only 1% saw a fall. Panellists commonly pointed to fuel, transport and agricultural products.
To protect their margins, companies raised their own prices sharply. Selling-price inflation hit its second-fastest pace since November 2023, beaten only by June 2026.
That pace “implies that businesses are increasingly passing higher costs to consumers,” Legilisho said. He called the rise in the headline index “a demand-led improvement” rather than “a broad-based recovery in activity”.
Official figures point the same way. The Kenya National Bureau of Statistics put annual inflation at 6.8% in September, up from 6.6% in August.
Transport prices were 15.6% higher than a year earlier, and food and non-alcoholic drinks 9.5% higher. Diesel cost 26.9% more than a year before, and petrol 15.8% more.
In Nairobi, the Energy and Petroleum Regulatory Authority (EPRA) caps petrol at KSh 214.03 (US$1.65) a litre until 14 October. Diesel is capped at KSh 217.86 (US$1.68), and both prices are unchanged from the previous month.
What It Means for US Readers
For investors, the Kenya PMI shows customers still buying, while firms raise prices to protect margins. Companies serving Kenyan consumers face demand on one side and rising fuel and farm costs on the other.
Legilisho warned that without easier costs and better input supply, “growth may remain modest and increasingly inflationary.” That is the main risk behind the better headline number.
For travellers, the price picture matters more than the index. Petrol in Nairobi costs about US$6.25 per US gallon, and transport prices are 15.6% above their level a year earlier.
Amounts here are converted at about 129.58 Kenyan shillings to the US dollar on 5 October 2026. Background on the country is in the Kenya Explained 2026 guide.
For policy watchers, the next marker is Kenya’s interest rate decision on 7 October. The survey adds fresh evidence that companies are passing costs on to customers.
What Is Not Known
The release does not publish the separate index values for orders, output or prices, only their direction and pace. It also does not say how large the average price rises were in shillings.
The Kenya PMI is a survey of about 400 companies, not official output data. It does not show how fast the whole economy grew in September, and it does not name the firms involved.
Nor is it known whether EPRA will change Nairobi’s pump prices when the current price cycle ends on 14 October.
What Comes Next
Business confidence slipped to a four-month low in September, but stayed among the strongest readings in more than five years. Optimistic firms cited capacity expansion, technology investment, marketing and new products.
Legilisho called the near-term outlook “cautiously positive”, with demand supporting activity. The October survey, gathered in the second half of the month, will show whether stronger orders finally lift output.
More: Kenya news in English, every day from The Rio Times.
What is the Kenya PMI?
The Kenya PMI is a monthly survey of about 400 private companies, compiled by S&P Global for Stanbic Bank Kenya. A reading above 50 means business conditions improved on the previous month.
What was Kenya’s PMI reading for September 2026?
The index rose to 51.3 in September from 49.7 in August. It was released on Monday 5 October 2026.
Did Kenyan companies produce more in September?
No, output fell for a seventh month, although only slightly. Rising new orders, hiring and stocks of inputs lifted the overall index above 50.
Why are prices rising in Kenya?
Firms cited higher costs for fuel, transport and agricultural products. Official inflation rose to 6.8% in September, with transport prices up 15.6% on a year earlier.
How much does fuel cost in Nairobi?
Petrol is capped at KSh 214.03 (US$1.65) a litre and diesel at KSh 217.86 (US$1.68) until 14 October 2026, according to EPRA.
Sources: S&P Global and Stanbic Bank, Stanbic Bank Kenya PMI news release, September 2026, 5 October 2026; The Star, Kenyan business activity rebounds as demand offsets rising costs, 5 October 2026; CNBC Africa, Kenya private sector activity expands in September, PMI shows, 5 October 2026; The Kenyan Wall Street, Kenya inflation hits 6.8% on food, transport pressures (KNBS data), 30 September 2026; People Daily, Kenya inflation rises to 6.8% in September, 30 September 2026; Citizen Digital, Petrol, diesel, kerosene prices remain unchanged in latest EPRA review, 14 September 2026; Energy and Petroleum Regulatory Authority (EPRA), pump prices, 5 October 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief
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