Nigeria’s PMI rises for the 13th consecutive month – CBN

Nigeria’s Purchasing Managers’ Index (PMI), a gauge for the direction of economic activities in Nigeria, stood at 49.7 points, indicating a contraction in economic activities for the thirteenth consecutive month.

This was disclosed by the Central Bank of Nigeria (CBN) in its July PMI survey report released on Wednesday.

However, it said the index shows improvement compared to the 48.8 points recorded in the previous month.

According to the report, output level, suppliers’ delivery time and stock of inventory expanded. New orders and employment contracted at a slower rate compared to the levels recorded in the previous month.

The survey, conducted from 15 to 19 July, gathered responses from purchasing and supply executives across Nigeria’s three main economic sectors: Agriculture, Industry, and Services.

The PMI is derived from these responses, reflecting changes in various aspects of business activity. An index reading above 50.0 points signals an expansion in business activities, whereas a reading below 50.0 points indicates a contraction. An index of exactly 50.0 points denotes no change in business conditions.

As part of its ongoing data enhancement initiative, the CBN had on Tuesday announced the reintroduction of some crucial economic reports which include the Purchasing Managers’ Index (PMI), Business Expectation Survey (BES), Inflation Expectation Report, and other significant macroeconomic indicators.

Sectoral breakdown

The breakdown shows that the services sector recorded expansion for the second consecutive month while the industry and agricultural sectors registered slower contraction when compared to the level recorded in the previous month.

Within the industry sector, the manufacturing, construction and mining & quarrying; electricity, gas & water supply subsectors all recorded contractions in the review month.

For the industrial sector, the July report showed that the Industry Sector PMI stood at 48.3 points, marking its sixth consecutive month of contraction. Nevertheless, there were signs of improvement in industrial activities, with increased production levels and quicker supplier delivery times compared to June.

In July, declines were noted across the manufacturing, mining, quarrying, electricity, gas, water supply, and construction subsectors.

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Out of the 17 subsectors surveyed, 11 experienced contractions, while six saw expansions. Notably, transportation equipment faced the most significant contraction, while Furniture and Related Products saw the most notable expansion.

For the services sector, the report revealed that the index reached 50.3 points, indicating expansion for the second consecutive month since May 2023.

The data showed growth in Business Activity and Stock of Raw Materials Inventory, although New Orders decreased and Employment levels remained stable during the review period. Among the 14 subsectors surveyed, eight experienced growth, while six saw declines.

The Motion Pictures, Cinema, Sound Recording, and Music Production subsector exhibited the highest growth, whereas the Management of Companies subsector faced the most significant contraction.

For the agriculture sector, the index stood at 49.7 points, reflecting a contraction in economic activities for the third consecutive month.