SMI index shows Nigeria economic growth on course

A report released on Monday by World Economics showed February assessment of headline Sales Managers’ Index, SMI, posted at 61.4 percent, little changed from its value in January. Nevertheless, it is first indicator of growth in business activity after three months of successive decline in the value of the index.

World Economics is a think-tank analytical organisation that releases monthly assessment of economic activity in countries around the world.

According to the report, Business Confidence Index, BCI, in the country fell to 85.1 percent, from 87.9 in January. The result however did not deter analysts from maintaining “hopes of better economic conditions in the next few months.”

“Expectations regarding the short-term outlook for business remained high in February despite easing to the weakest level since March 2015.”

For the fourth consecutive month, the Market Growth Index and the Product Sale Index “which reflects growth of the general marketplace, fell albeit at a slower rate compared to last period.

February’s reading nevertheless continued to signal robust rates of market expansion across the Nigerian economy.”

For the product sales index, the report signalled “only moderate improvements in sales growth, with sales managers commenting to increasing prices as one major reason for the general declaration in products sales.

Increases recorded on the Prices Charged Index were the sharpest rate in the history of the survey. “The index registered 62.1 in February, up from 56.5 on the previous month.” Prices appreciated as a result of unfavourable exchange rate movements which raised the prices of imported goods and contributed to the overall increase in inflationary pressures.

The Staffing Index on the other hand, which reflects the number of staff taken on compared to the same period last year, softened for the sixth month in a row in February.

Although it remained above the 50.0 no-change mark that separates growth from contraction, the current index figure was the lowest recorded by the panel.

 

FRANK ELEANYA