Uganda’s private sector continued to experience improving business conditions in June 2025, marking the fifth consecutive month of expansion, according to the latest Stanbic Purchasing Managers’ Index (PMI).
The PMI, compiled by S&P Global, dipped slightly to 55.6 from 56.4 in May but remained above the 50.0 threshold, signaling ongoing growth driven by increases in output, new orders, employment, and purchasing activity.
Christopher Legilisho, an economist at Stanbic Bank, attributed the sustained expansion to robust economic conditions.
“The Stanbic Uganda PMI signaled an overall expansion for a fifth straight month in June due to robust economic conditions in the private sector, with both output and new order growth still healthy,” Legilisho said.
He added that the positive trends in employment and inventories suggest strong GDP growth for 2025, fueled by favorable demand across most sectors.
The report highlighted broad-based growth in new business and output levels across agriculture, mining, manufacturing, construction, wholesale, retail, and services.
Favourable demand and new client wins supported the upturn. Companies also benefited from faster input delivery times, enabling them to reduce backlogs for the sixth consecutive month.
Despite rising input costs, including staff wages, fuel, and materials, output prices remained largely unchanged as some firms discounted prices to stay competitive. Only the agriculture and wholesale & retail sectors reported increases in selling prices.
Legilisho noted that subdued inflation, an appreciating shilling, and declining energy prices contributed to a stable economic environment, with headline inflation at 3.9% year-on-year in June, up slightly from 3.8% in May.
Employment saw further growth as firms hired both temporary and permanent staff to meet rising demand. Increased capacity also allowed businesses to manage workloads effectively.
Additionally, strong demand and shorter lead times encouraged companies to boost input purchases and stockpiling.
Looking ahead, Ugandan businesses expressed optimism for the coming year, citing plans for increased advertising and outreach to new customers as key drivers of future growth.
The Stanbic PMI is based on responses from approximately 400 purchasing managers across various sectors, with the index calculated as a weighted average of New Orders (30%), Output (25%), Employment (20%), Suppliers’ Delivery Times (15%), and Stocks of Purchases (10%).
