Credit squeeze slows private sector growth

“Since the legislation to cap interest rates came into effect...we can now see signs of distress within the private sector as...[survey respondents] lament about cash shortages,” said Jibran Qureishi, the East Africa economist at Stanbic Bank.PHOTO: COURTESY

Activity in the private sector increased modestly in January, as banks slowed new lending to firms, a survey showed yesterday.

The Markit Stanbic Bank Kenya Purchasing Managers Index (PMI) fell to 52.0 per cent in January from 54.1 per cent in December, remaining above the 50.0 per cent line that divides growth from contraction.