Manufacturing Sector Records Three Months Contraction – CBN Report

The Nigerian economy contracted in July for the third consecutive month, the manufacturing and non-manufacturing purchasing managers indices have shown.

The statistics department of the Central Bank of Nigeria disclosed this in its Purchasing Managers’ Index survey report for July which was released on Wednesday.

The report said, “The manufacturing PMI in the month of July stood at 44.9 index points, indicating contraction in the manufacturing sector for the third consecutive month.

“Of the 14 surveyed subsectors, transportation equipment subsector reported growth (above 50 per cent threshold) in the review month while non-metallic mineral products sector reported no change.”

The CBN, however, said the remaining 12 subsectors reported contraction, namely printing and related support activities; primary metals; fabricated metal products; paper products; and food, beverage and tobacco products.

Others are chemical and pharmaceutical products; furniture and related products; electrical equipment; plastics and rubber products; petroleum and coal products; textile, apparel, leather and footwear and cement.

“The non-manufacturing sector PMI stood at 43.3 points in July 2020, indicating contraction in non-manufacturing sector for the fourth consecutive month,” the CBN said.

It said of the 17 surveyed subsectors, only two, namely arts, entertainment and recreation; and transportation and warehousing reported growth (above 50 per cent threshold) in the review month.

The report said, “The remaining 15 subsectors reported declines in the following order of water supply, sewage and waste; repair, maintenance/washing of motor vehicle; professional, scientific, and technical services; finance and insurance; educational services; public administration;

“Wholesale/retail trade; accommodation and food services; real estate rental and leasing; utilities; agriculture; management of companies; information and communication; construction; health care and social assistance and electricity, gas, steam and air conditioning supply.”

In another report, titled ‘July 2020 business expectations survey report,’ the CBN stated that at -7.9 index points, the overall confidence index indicated respondents’ pessimism on the overall macro economy in the month of July.

It, however, added that respondents were optimistic in their outlook for August with a confidence index of 33.7.

The CBN said the respondents expressed optimism in the overall business outlook in September 2020 and January 2021 as shown in a greater confidence of the economy, at 45.5 and 62.4 index points, respectively.

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