Manufacturing index expands further on sustained central bank’s intervention

Sustained forex intervention by the Central Bank of Nigeria (CBN) spurred expansion of the nation’s Manufacturing Purchasing Managers’ Index (PMI) as it rose to 57.0 in June, improving from 56.5 index points in May.

According to the CBN, the index grew at a faster rate when compared to the index in the previous month.

Of the 14 subsectors surveyed, 10 reported growth in the review month in the following order: paper products; furniture & related products; printing & related support activities; food, beverage & tobacco products; plastics & rubber products; electrical equipment; textile, apparel, leather & footwear; chemical & pharmaceutical products; petroleum & coal products and non-metallic mineral products.

The transportation equipment; fabricated metal products; primary metal; and cement subsectors declined in the review month.

Similarly, the inventories index of the manufacturing grew for the fifteenth consecutive month in June 2018.

At 57.7 points, the index grew at a slower rate when compared to its level in the previous month. Eleven of the 14 subsectors recorded growth, 2 remained unchanged while 1 recorded decline in raw material inventories

At 59.2 points, the production level index for the manufacturing sector grew for the sixteenth consecutive month in June 2018. The index indicated a faster growth in the current month, when compared to its level in the preceding month.

Ten of the 14 manufacturing subsectors recorded increase in production level, 1 remained unchanged, while the remaining 3 recorded declines in production level during the review month

The composite PMI for the nonmanufacturing sector also stood at 57.5 points in June 2018, indicating expansion in the Nonmanufacturing PMI for the fourteenth consecutive month. The index grew at a faster rate when compared to that in May 2018.

At 58.5 points, non-manufacturing inventory index grew for the fourteenth consecutive month, indicating growth in inventories in the review period.

Meanwhile, the manufacturing supplier delivery time index stood at 56.5 points in June 2018, indicating slower supplier delivery time for the thirteenth consecutive month.

This, according to industry observers, may be attributed to logistics challenges in the country.