The Ghanaian private sector remained in growth territory at the start of 2019, although rates of expansion in new orders and business activity softened from December.
Article continues below
The slowdown in output growth contributed to a record rise in backlogs of work, with companies increasing their staffing levels at a sharper pace as a result.
Rates of inflation remained relatively muted during January.
The headline seasonally adjusted PMI posted 51.6 in January, down slightly from 52.3 in December and signalling a modest improvement in the health of the private sector.
Business conditions have now strengthened in each of the past four months.
New business continued to rise in January, the fourth successive month in which growth has been recorded.
That said, the rate of expansion softened and was only slight.
Where new orders increased, panellists reported greater interest from clients, with good quality products helping them to secure new work.
Higher sales meant that Ghanaian firms raised output for the third month running.
The rate of growth in business activity also eased at the start of the year, however.
The slowdown in the pace at which companies raised their output contributed to a marked accumulation of backlogs of work.
Moreover, the pace of increase in outstanding business was the greatest since the survey began in January 2014.
Backlogs have increased for seven consecutive months.
Efforts to limit the pace of backlog accumulation as well as respond to new work inflows led companies to raise their staffing levels at a faster pace in January.
The rate of job creation was solid, and the most marked since July 2018.
Latest data signalled ongoing muted inflation across the private sector.
Higher supplier charges meant that purchase prices increased at a marked pace, albeit one that was littlechanged from December's six-month low and below the series average.
Staff costs, meanwhile, increased modestly, albeit at the fastest pace in three months.
Higher input costs led companies to raise their selling prices for the ninth month running, with charges also increased to reflect product improvements.
The rate of charge inflation picked up from that seen in December, but remained relatively modest.
Rising workloads and expectations of further demand improvements in coming months led to increases in both purchasing activity and inventories.
Meanwhile, suppliers' delivery times continued to shorten.
Finally, business confidence improved slightly at the start of 2019, with companies strongly optimistic that output will rise over the coming year.
Positive sentiment reflected hopes of improving economic conditions, business expansion plans and predicted improvements to productivity. ■