Growth in the private sector gained momentum last month with business conditions improving to the greatest extent in five months at the end of the first quarter.
Output and new order growth strengthened for the second month, which led to a high rise in purchases.
Employment rose marginally, and firms continued to reduce their backlogs at near-record rates. Looking forward, firms remain hopeful that their output levels will increase over the next one year, but there were signs of optimism moderating as sentiment fell to the lowest in three months.
Input price inflation remained robust with material shortages driving a sharp increase in purchase costs. In turn, firms raised their selling prices at a faster pace.
The headline figure derived from the survey is the Purchasing Managers’ Index™ (PMI®), a property of Stanbic IBTC Bank PLC.
Readings above 50 signal an improvement in business conditions on the previous month, while readings below 50 show a deterioration.
At 52.9 in March, up marginally from 52. in February, the headline seasonally adjusted PMI signalled expansion, and one, which extended the sequence of growth to nine months.
Higher customer numbers led to a rise in new orders with the rate of growth the strongest since last October. This supported another expansion in output, and one which was solid overall. Sub-sector PMI readings indicated that manufacturing posted the fastest rise in output in March, followed by services and agriculture.
Wholesale and retail recorded a decline in activity. Rising output encouraged firms to increase their purchases and employment in March.
Higher staffing allowed firms to complete outstanding work. The rate of reduction was the second-fastest in the series, surpassed only by that seen in February.