THE nation’s manufacturing sector has recorded further decline as the sustained Central Bank of Nigeria, CBN, latest sector report shows the Manufacturing Purchasing Managers Index (PMI) for January 2021 at 44.9 index points, a 4.7 points drop from 49.6 index points recorded in December 2020. Similarly, the non-manufacturing PMI fell by 2.4 points to 43.3 index points in January from 45.7 index points in December 2020.
A composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding; 50 points indicate no change while a performance below 50 points indicates a contracting sector. The apex bank’s Economic Report for January 2021, stated: “The Composite Manufacturing PMI contracted to 44.9 index points, from the 49.6 index points recorded in the preceding period. The decrease was associated with the decline in demand, rising production cost and supply chain bottlenecks experienced by firms, in the review period. “All components of the Composite Manufacturing PMI contracted, except supplier delivery time, which increased to 55.7 index points from 51.2 points in December 2020, due to improvements in logistics, shipments and inventory control.”
On non-Manufacturing PMI, it said: “Similarly, the Composite Non-Manufacturing PMI for January 2021 dropped to 43.3 index points from 45.7 points in December 2020. The index recorded declines in all the subcomponent indexes.” The report also noted that the level of employment and business activity declined during the review period. According to the regulator, in January employment level fell by 2.1 points to 46.3 index points from 44.2 index points in December. Similarly, level of business activity dropped by 3.1 points to 46.9 index points from 43.8 index points in December 2020.