Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Zambian Employment Growth Hits 2-Year High As Recovery Continues

Published 13/09/2017, 05:26
Updated 05/03/2021, 15:50

Zambian companies took on staff at the fastest pace in just over two years in August, according to survey data, amid sustained expansions in output and new orders. This adds to growing signs that the economy is in an improving phase at present.

Output continues to rise

The Stanbic Bank Zambia PMI, compiled by IHS Markit, signalled that output increased for the third month running, with the rate of expansion solid again in August. The latest data support recent evidence that Zambian economic growth has gathered pace during 2017.

Zambia Economic Growth

Output growth continued to reflect increases in new orders. New business has risen in each month since April. Sustained expansions in workloads added to business confidence, with firms showing signs of being increasingly willing to invest in their workforce to expand capacity. The rate of job creation quickened to the fastest in just over two years in August.

Discounts help to support growth

Comments from panellists suggested that price discounting had helped to boost new orders in the latest survey period as firms attempted to attract customers. Output prices decreased at the fastest pace since the survey began in January 2014, dropping for the sixth month running. Companies will hope that improvements in demand continue in coming months, reducing the need for discounting.

Reasons cited by companies for reductions in output prices in August

Companies were able to reduce charges due to a lack of cost inflation. Overall input prices rose only slightly, with inflationary pressures much weaker than in 2015 and at the end of 2016.

The lack of inflationary pressures signalled by the PMI data is matched by official consumer price data. The Zambian economy continues to benefit from the strong rebound in international commodity prices leaving the kwacha exchange rate 10.5% stronger against the US dollar during the first eight months of 2017.

Good rainfall has furthermore lifted agricultural production significantly, while improved local food supply left food prices down and pulled headline inflation into single digits at 6.3% by August from 19.6% for the same period a year ago.

Zambia CPI

Outlook continues to brighten

Alongside improvements in demand and moderating inflation, hydro-electrical power supply also strengthened, boosting overall manufacturing and mining output. The finalisation of a future IMF support program is likely to send a strong signal to investors and anchor the country’s fiscal consolidation path moving forward. The positive sentiment has spilled over to improved employment conditions in the economy and will be a boost to the country’s consumer market in the near term.

The PMI data for September will be release on October 4th, completing the picture of the Zambian economy for the third quarter of the year.

Disclaimer: The intellectual property rights to these data provided herein are owned by or licensed to Markit Economics Limited. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without Markit’s prior consent. Markit shall not have any liability, duty or obligation for or relating to the content or information (“data”) contained herein, any errors, inaccuracies, omissions or delays in the data, or for any actions taken in reliance thereon.

In no event shall Markit be liable for any special, incidental, or consequential damages, arising out of the use of the data. Purchasing Managers' Index™ and PMI™ are either registered trademarks of Markit Economics Limited or licensed to Markit Economics Limited. Markit is a registered trade mark of Markit Group Limited.

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.