Kenya private sector PMI jumps to 29-month high in September

NAIROBI (Reuters) - Activity in Kenya's private sector grew at the fastest rate in 29 months in September, buoyed by more firms resuming operations after the easing of some restrictions imposed to stem the spread of COVID-19, a survey showed on Monday.

The Markit Stanbic Bank Kenya Purchasing Managers' Index (PMI) jumped to 56.3 in September, from 53.0 in August, its highest level since April 2018. The 50.0 mark separates growth from contraction.

"With the government easing lockdown restrictions during the third quarter of the year, firms saw a release of pent-up demand as clients largely returned to markets," the survey report said.

The East African nation, which has 38,713 confirmed cases of the COVID-19 and 718 fatalities so far, started the gradual re-opening its economy in July.

"The PMI indicated a further improvement in business confidence and operating conditions this month," said Jibran Qureishi, head of Africa Research at Stanbic Bank.

The central bank expects the economy to expand by 3.1% this year, reflecting the growing optimism from businesses.

The finance ministry, however, expects growth of less than 2.5%, while the International Monetary Fund projects a contraction of -0.27% for the year.

"We ought to be cautious around the possibility of a second wave globally that could dampen external demand again," Qureishi warned.

(Reporting by George Obulutsa; Editing by Toby Chopra)