Business activity in Nigeria fell for the first time in eight months as a result of price pressures which weakened demand, a new Purchasing Managers’ Index (PMI) has shown.
The latest monthly PMI by Stanbic IBTC Bank released on Thursday showed the headline index declined to 49.2 in July from 50.1 in June. Readings above 50.0 signal an improvement in business conditions, while those below show deterioration.
Read also: Shopping malls, businesses tighten security measures ahead hunger protest
“The renewed worsening in the health of the private sector mainly reflected the first reductions in output and new orders since November last year. In both cases, rates of decline were only modest,” the report said.
It stated that however, anecdotal evidence continued to highlight the negative impact of sharp price increases on customer demand, with clients often unwilling or unable to commit to new projects.
“Selling prices continued to increase sharply at the start of the third quarter as companies passed higher input costs through to their customers,” it said. “This was despite the rate of inflation easing to the slowest since May 2023 amid reports from some panellists that they had lowered charges as part of efforts to secure sales.”
