PMI Slows 56.2 Points Signaling Lower to Business Activities

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As inflation figure rose slightly in August, business activities slowed down last month as the Purchasing Managers Index (PMI) for both the manufacturing and non-manufacturing sectors stood at 56.2 and 56.6 index points in September, slower than the previous month.

The Manufacturing PMI in the month of September stood at 56.2 index points, indicating expansion in the manufacturing sector for the 18 consecutive month, although slower than 57.1 index points recorded in August, according to the PMI report released by the Central Bank of Nigeria (CBN) yesterday. Inflation figures in August had risen for the first time in months rising slightly to 11.23 per cent.

Of the 14 subsectors surveyed in the manufacturing sector, 10 reported growth in the review month. The electrical equipment; Printing & related support activities; Transportation equipment; Nonmetallic mineral products; Chemical & pharmaceutical products; Fabricated metal products; Furniture & related products; Textile, apparel, leather & footwear; Food, beverage & tobacco products; and Plastics & rubber products all recorded expansion while the Petroleum & coal products; Cement; Paper products; and Primary metal subsectors declined in the review month.

At 58.4 points, the production level index for the manufacturing sector grew for the 19th consecutive month in September 2018, indicating a slower growth in the current month, when compared to its level in the preceding month. Of the 14 manufacturing subsectors, 10 recorded increase in production level, one remained unchanged while three declined.

The employment level index in the manufacturing sector in September 2018 stood at 54.9 points, indicating growth in employment level for the 17th consecutive month but slower than the previous month.

PMI for the non-manufacturing sector stood at 56.5 points in September 2018, indicating expansion for the 17 consecutive month although at a slower rate when compared to August 2018. Fifteen of the 17 subsectors recorded growth. The Educational services; Management of companies; Information & communication; Agriculture; Finance & insurance; Water supply, sewage & waste management; Wholesale/Retail trade; Real estate rental & leasing; Utilities; Accommodation & food services; Transportation & warehousing; Electricity, gas, steam & air conditioning supply; Professional, scientific, & technical services; Health care & social assistance; and Repair, Maintenance/Washing of Motor Vehicles all recorded expansion while the Arts, Entertainment & Recreation subsector remained unchanged, while construction subsector recorded contraction in the review period

At 58.1 points, the business activity index grew for the 18th consecutive month, indicating expansion in non-manufacturing business activity in September 2018. The index grew at a slower rate when compared to its level in the previous month as 12 subsectors recorded growth in business activity, while three remained unchanged and two declined in the review month.

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