In line with its resolve to reintroduce key economic reports, the Central Bank of Nigerian (CBN) on Wednesday published results of its July 2024 Purchasing Managers’ Index (PMI) at 49.7, an indication of a contraction in business activities within the period.
An index of 50.0 shows that there was a no-change in the direction of the economic activities in the country for the period.
The July 2024 level, though the 13th consecutive contraction, however represented an improvement, when compared to the 48.8 points recorded in the previous month, with the lowest in the past 12 months being 39.2 in March 2024.
The last time the PMI closed positive was May 2023 when it peaked at 54.6, while last month’s level is the best since June 2023.
Output level, suppliers’ delivery time and stock of inventory expanded in July 2024, the report said, adding that “new orders and employment contracted at a slower rate compared to the levels recorded in the previous month.
A sectoral breakdown of the PMI shows that the services sector recorded an 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.
Also, “within the Industry Sector, Manufacturing, Construction and Mining & Quarrying; Electricity, Gas & Water Supply Subsectors all recorded contractions in the review month,” the report added.
Another pleasant news was the 50.3 points Composite Output Index which indicated growth in production level for the first time after five consecutive months of contraction, returning to around the level in January, after 16 of the 36 subsectors
Reviewed reported growth in production. Another 17 subsectors registered a decline with Transportation Equipment suffering the highest decline, while the remaining three unchanged.
The composite level of New Orders index closed at 48.8 points, indicating a contraction in the volume of new incoming businesses/orders, a breakdown of which showed that of the 36 subsectors reviewed, 25 reported declines in New Orders with Chemical & Pharmaceutical Products suffering the highest decline, while 9 subsectors reported increased level of New Orders. Cement and Forestry, however, were stationary.
Composite employment level during the period contracted at 48.7 index points, the seventh consecutive month, despite being an improvement when compared to the 48.3 points recorded in the previous month. A breakdown showed that 18 subsectors reported various levels of contraction in employment, led by Printing and Related Support Activities which recorded the highest decline. The Primary Metal subsector remained unchanged, while the remaining 17 subsectors reported increased Employment Levels, with the Petroleum & Coal Products subsector having the higher Employment Level.
In the period covered by the report, according to the CBN, the Industry Sector PMI at 48.3 points, recorded the sixth consecutive month of contraction, despite which industrial activities improved as shown higher Production Level and faster Suppliers’ Delivery Times compared to June 2024.
The Industry Production Index showed an expansion at 50.5 points in July 2024, a growth in production for the second consecutive month, with eight subsectors recording growth in production during the review month with Water Supply, Sewerage & Waste Management recording the highest growth, Printing & Related Support Activities Subsector was stationary, while the remaining eight subsectors registered declines in production with Transportation Equipment reporting the highest contraction.
The Agriculture Sector index stood at 49.7 points in July 2024, indicating a contraction in economic activities for the third consecutive month, despite which General Farming Activity and the Stock of Agricultural Inventory reported growth at 50.1 points. However, New Orders and Employment Levels declined. Among the five surveyed subsectors, Livestock, Fishing/Fish Farming, and Agricultural Support Services recorded contraction in the review month.
The General Farming Activities expansion implied an increase in General Farming Activities after recording a contraction in the previous month, of which crop production reported growth, while Livestock and Fishing/Fish Farming subsectors recorded a decline.
