Nigeria’s economy contracted for the thirteenth consecutive month in July, according to the Central Bank of Nigeria’s (CBN) composite purchasing manager index (PMI), which stood at 49.7 points.
However, the indicator has improved from 48.8 points the previous month, according to the apex bank’s PMI report. According to the PMI, output levels, supplier delivery times, and inventory stocks all increased in July. New orders and employment decreased at a slower rate than in the previous month.
The sectoral breakdown reveals that the services sector expanded for the second consecutive month, while the industrial and agricultural sectors contracted more slowly than 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, the PMI stated. The composite output index stood at 50.3 points in July 2024, indicating growth in production level for the first time after five consecutive months of contraction.
Of the 36 subsectors reviewed, 16 subsectors reported growth in production during the review month, while 17 subsectors registered a decline with Transportation Equipment reporting the highest decline. CBN said the composite level of new orders index at 48.8 points, indicated contraction in the volume of new incoming businesses/orders.
The PMI showed that of the 36 subsectors reviewed, 25 subsectors reported declines in new orders, with chemical & pharmaceutical products recording the highest decline. While 9 subsectors reported increased level of New Orders in the review month, Cement and forestry, however, were stationary
At 48.7 index points, the composite Employment Level indicated contraction in July 2024 for the seventh consecutive month. The index improved in July 2024 when compared to the 48.3 points recorded in the previous month. Eighteen subsectors reported a contraction in Employment, with Printing & Related Support Activities recording the highest decline in the review month.
Primary Metal subsector remained unchanged, while the remaining 17 subsectors reported increased Employment Levels with Petroleum & Coal Products subsector having the higher Employment Level
The overall Stock Level in July 2024 registered an expansion, with an index of 50.7 points. This marks the second instance of expansion in 2024.
The report stated that sixteen subsectors reported increased stock, with Petroleum & Coal Products experiencing the highest growth.
Six subsectors remained stationary, while fourteen subsectors saw declines in stock levels. Notably, the Transportation Equipment subsector recorded the lowest stock level for the review month. In July 2024, both the overall input and output prices decreased compared to June 2024. However, the overall output price was lower than the overall input price.
The output prices of the Industry, Services, and Agriculture sectors were lower than those recorded in June 2024. For input prices, Agriculture and Services sectors prices were lower than the level in June, while Industry sector price was higher in July
In July 2024, the Industry Sector PMI at 48.3 points, recorded the sixth consecutive month of contraction. Despite this, industrial activities improved as shown higher Production Level and faster Suppliers’ Delivery Times compared to June 2024.
The subsectors with the highest contraction and expansion are Transportation Equipment and Furniture & Related Products, respectively.
