Zambian private sector shows signs of recovery in Dec – PMI

Zambia’s Purchasing Managers’ Index (PMI) rose to 50.8 in December 2024, up from 49.2 in November, marking the fastest improvement in business conditions since July 2023 and ending a 12-month decline.

The recovery was driven by increased new orders, modest job creation, and a slight rise in input purchases. Stabilised electricity supplies and improved customer confidence boosted new business growth to its highest level since May 2023.

However, output remained constrained by reduced working hours and the lingering effects of load shedding. Employment and input buying returned to growth, breaking a four-month trend of job cuts, while work backlogs rose at the fastest rate in three months.

Cost pressures intensified as input prices climbed at their steepest pace since September, fuelled by a depreciating kwacha, higher fuel costs, and wage increases.

Firms passed on some of these costs to customers, though selling price inflation eased to a ten-month low.

While business optimism fell to its lowest level since March 2024, firms remain cautiously hopeful for stronger demand in the year ahead.

Attribution: Amwal Al Ghad English

Subediting: Y.Yasser