Fresh hope has been injected into Kenya's economy as a report revealed private sector activity surged in November 2025, reaching its strongest level in five years.
The latest Stanbic Bank Kenya Purchasing Managers’ Index (PMI) reached 55.0 in November 2025 in a figure which was a strong rise from the 52.5 recorded in October. The November reading marks the highest level the index has reached since October 2020.
It is worth noting that any score above 50 signals business conditions that are improving, with economists saying the latest jump reflects steady strengthening economic activity in the country.
November's decent performance was driven by the fastest rise in business activity, supported by a sharp increase in new orders, which matched the strongest levels last seen in 2020.
Many companies attributed the improvement to customers having a slightly improved purchasing power, combined with successful new product launches.
Further, there have been more aggressive marketing efforts in recent months and increased referrals, which have considerably helped overall business activity.
"The uplift in business activity was also one of the sharpest recorded in the survey's history. Survey panellists attributed the steep increase in output to stronger market demand," Stanbic Bank said in comments accompanying the survey.
Amid positive signs, companies warned that the material costs and higher taxation continue to strain their margins even as overall cost pressure softens.
A ripple effect of rising demand fell directly into job creation, with the report indicating that employment increased for the tenth straight month. Also, the rate of hiring was the second fastest since August 2023, signalling growing confidence among employers.
For the first time in more than five years, firms also stepped up purchasing activity at the quickest pace in an effort to rebuild inventories and meet rising orders.
Despite positive signs, long-term business confidence softened for the third month in a row, with many companies remaining more cautious than they were in August.
According to economist Christopher Legilisho, although optimism has dipped, policies introduced by the government over the past year are starting to take effect in the real economy. This effectively contributed to November's strong performance.
