Kenya’s economy is showing signs of pulling out from July’s public protests disruptions that saw closure of businesses and destruction of property in Nairobi and other major urban centres.

However, this recovery is still somewhat weak as shown by the Stanbic Bank Kenya Purchasing Managers’ Index (PMI) which improved slightly to 49.4 in August, from a 12-month low of 46.8 in July 2025. Most firms recorded weak sales and output as well as purchases even as companies surveyed said they were hiring as well as pushing up their inventories.

“The Stanbic Kenya PMI improved in August, recovering from the solid decline in July, although business conditions were still subdued. Output declined more than new orders due to weak disposable incomes and challenging economic conditions. Nevertheless, firms, especially in manufacturing, are more upbeat about output over the next 12 months, which should imply healthier business activity in the coming months,” said Christopher Legilisho, Economist at South Africa’s Standard Bank.

Business has been tough for companies since May this year especially those in the agricultural sector, construction and services. This is except those in the manufacturing and wholesale & retail sectors, which have posted growth. While some businesses noted weak client spending, while others experienced a rebound in demand as economic conditions steadied.

Input costs rose sharply, though inflation eased for the first time in five months. Wage pressures intensified due to cost-of-living adjustments, while purchase prices rose mainly on higher taxes such as those on fuel. However, output charges increased only marginally, with some firms discounting to attract customers, keeping price inflation at its lowest in a year.

According to analysts at Standard Investment Bank(SIB), while the economy is still on its knees, job creation has been up with the fastest growth recorded since May 2025. “Firms have pinned their hopes on new marketing, product diversification, and branch expansion to drive future growth, with manufacturers especially upbeat,” said the SIB Weekly Note.

The Stanbic Bank Kenya PMI™ is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 private sector companies. The panel is stratified by detailed sector and company workforce size, based on contributions to GDP.