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Manufacturing PMI contracts to 49.4 index points in May

...Non-manufacturing by 25.3 points

The Central Bank of Nigeria (CBN) on Friday released the Purchasing Managers Index (PMI) report, which showed that the Manufacturing and non-Manufacturing Purchasing Manager’s Indices declined significantly to 42.4 and 25.3 index points, respectively, in May 2020, compared with 51.1 and 49.2 index points in March 2020.

Generally, the purchasing managers’ activities in May 2020, were largely affected by the lockdown of the global economy to curtail the spread of the COVID-19 pandemic.

Godwin Emefiele, governor, of CBN said the decline in manufacturing PMI was significant following thirty-six consecutive months of expansion, while the non-Manufacturing PMI contracted for the second consecutive month.

The contraction in the manufacturing and non-manufacturing PMIs was attributed to slower growth in production, new orders, employment level, raw materials and input prices. The employment level index for the manufacturing and non-manufacturing PMIs also contracted further to 25.5 and 32.0 index points, respectively, in May 2020 compared with 47.1 and 47.3 index points in March 2020.

The May1 2020 PMI survey was conducted by the Statistics Department of the Central Bank of Nigeria during the period May 14-19, 2020. The respondents were purchasing and supply executives of manufacturing and non-manufacturing organizations in all 36 states in Nigeria and the Federal Capital Territory (FCT). The Bank makes no representation regarding the individual companies, other than the information they have provided.

A composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding, 50 points indicates no change and below 50 points indicates that it is generally contracting.

The manufacturing sector inventories index contracted for the second time in May 2020. At 37.4 points, the index further dipped when compared to its level in March 2020. All the 14 subsectors recorded reported lower raw material inventories in the review month.

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