Manufacturing sector expands at a slower rate in July

The manufacturing sector Purchasing Managers’ Index (PMI) stood at 56.8 index points in the month of July, indicating a sluggish expansion in the sector for the sixteenth consecutive month, the Central Bank of Nigeria (CBN) has said.

According to the PMI Survey Report by the apex bank released on Tuesday, the index, when compared to the previous month, grew at a slower rate, depreciating by 0.2 index points from 57 index points recorded in June.

The PMI is an indicator of the economic health for manufacturing and services sectors.

The PMI report showed that out of 14 subsectors captured under the survey, 13 subsectors reported growth in the review month.

The subsectors include: Petroleum & coal products; printing & related support activities; paper products; electrical equipment; primary metal; furniture & related products; nonmetallic mineral products; transportation equipment; textile, apparel, leather & footwear; chemical & pharmaceutical products; food, beverage & tobacco products; cement; and fabricated metal products.

On the other hand, the plastics & rubber products subsector declined in the review month.

Read Also: DBN to support 10,000 MSMEs with low interest loans

Production level, which stood at 59.0 points, New orders, which stood at 55.8 points, employment level at 55.0 points, and raw materials inventories at 57.4 points all grew at a slower rate, while supplier delivery time at 56.8 points grew at a faster rate in July, 2018.

Also, the composite PMI for the Non-manufacturing sector stood at 57.7 points in the period under review, indicating expansion in the Non-manufacturing PMI for the fifteenth consecutive month. The index grew at a faster rate when compared to that in June 2018.

Business activity, employment levels and inventories in the non-manufacturing sector grew at a faster rate; while new orders grew at a slower rate in the review month.

Meanwhile, following the first auction of Chinese Yuan (CNY) by the CBN, which led to the injection of CNY 69.8 million, the CBN estimated the exchange rate for the auction worth N3.6 billion between N49 and N51 per yuan.

The development was part of the process to make Chinese currency available to local exporters to facilitate trade between Nigeria and China under a three-year renewable bilateral currency swap agreement reached with the Peoples Republic of China (PBoC).

On July 20, the CBN had officially kicked off its intervention in the sale of foreign exchange in Chinese Yuan, it also injected $340 million into the interbank retail Secondary Market Intervention Sales (SMIS) segment of the foreign exchange market.

 

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