Businesses across the country have attributed the rising cost of goods and services to the rising fuel-related taxes, which they say have forced them to pass the expenses to consumers.

🇰🇪 Breaking It Down

According to Stanbic's Purchasing Managers' Index (PMI) released on Friday, July 3, rising fuel and raw material costs have forced many businesses to increase prices to protect their profit margins.

In his remarks, Standard Bank economist Christopher Legilisho disclosed that the increase in the prices of goods and services in June 2026 was the highest since 2014.

"The Stanbic PMI for June was upbeat on signs of a recovery after three months of weakness. However, output conditions remained subdued on concerns of soft client demand and rising price pressures," Legilisho said.

📌 What You Need to Know

The report warned that the current rise in commodity prices, driven by higher fuel costs, could last longer than the 2022 oil price shock.

Businesses also said increased fuel prices disrupted supply chains, with some suppliers delaying deliveries until they had enough goods to make transport economically viable.

The PMI also found that one in four businesses raised the prices of their goods and services in June, while only two per cent cut prices.

Despite the cost pressures, Kenya's private sector showed signs of recovery after three consecutive months of contraction, with the headline PMI improving from 46.6 in May to 50.0 in June.

"The Stanbic PMI for June was upbeat on signs of a recovery after three months of weakness. Firms' new orders grew due to robust sales volumes," the report revealed.

The survey also found that new customer orders returned to growth for the first time since February , with businesses crediting customer referrals, marketing campaigns and expansion initiatives for the improved sales.

📰 Source: Kenyans.co.ke