March 25, 2020/CBN
Introduction
The March 2020 PMI survey was conducted by the Statistics Department of the Central Bank of Nigeria during the period March 9-13, 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. The data contained herein further provides input for policy decisions.
Data and Method of Presentation
The Manufacturing and Non-Manufacturing PMI Report on businesses is based on survey responses, indicating the changes in the level of business activities in the current month compared with the preceding month. For each of the indicators measured, this report shows the diffusion index of the responses. The diffusion index is computed as the percentage of responses with positive change plus half of the percentage of those reporting no change, except for supplier delivery time, which is computed as the percentage of responses with negative change plus half of the percentage of those reporting no change. The composite PMI for the manufacturing sector is computed as the weighted average of five diffusion indices, namely: production level, level of new orders, suppliers’ delivery time, employment level and raw materials inventory/work in progress, with assigned weights of 25%, 30%, 15%, 10% and 20%, respectively. The composite PMI for the non-manufacturing sector is computed from four diffusion indices, namely: business activity, level of new orders, employment level and raw materials inventory, with equal weights of 25% each. 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 subsectorsreporting growth are listed in the order of highest to lowest growth, while those reporting contraction are listed in the order of the highest to the lowest contraction.
Manufacturing PMI Report
The Manufacturing PMI in the month of February stood at 51.1 index points, indicating expansion in the manufacturing sector for the thirty-sixth consecutive month (Fig. 2 and Table 1). The index grew at a slower rate when compared to the index in February. Of the 14 surveyed subsectors, 7 reported growth (above 50% threshold) in the review month in the following order: transportation equipment; petroleum & coal products; furniture & related products; food, beverage & tobacco products; cement; fabricated metal products and plastics & rubber products. However, electrical equipment; primary metal; nonmetallic mineral products; paper products; textile, apparel, leather and footwear; printing & related support activities and chemical & pharmaceutical products subsectors all recorded declines in the review month (Fig. 2 and Table 1)
Production Level
At 54.4 points, the production level index for the manufacturing sector grew for the thirty-seventh consecutive month in March 2020. The index however indicated slower growth in the current month, when compared to its level in February 2020. Seven of the 14 manufacturing subsectors recorded increased production level, while 7 subsectors recorded declines in production (Fig. 3 and Table 2).
New Orders
At 52.3 points, the new orders index grew for the thirty-sixth consecutive month, indicating increases in new orders in March 2020. The index grew at a slower rate, when compared to its level in February 2020. Five subsectors reported growth, 2 remained unchanged while 7 recorded declines in the review month (Fig. 4 and Table 3).
Supplier Delivery Time
The manufacturing supplier delivery time index stood at 49.4 points in March 2020, indicating contraction in supplier delivery time. The index recorded declines for the first time after thirty-three consecutive months of recorded growth. Five of the 14 subsectors recorded improved suppliers’ delivery time, 4 subsectors reported no change while 5 recorded slower delivery time in March 2020 (Fig. 5 and Table 4).
Employment Level
The employment level index for March 2020 stood at 47.1 points, indicating declines in employment level for the first time after recorded growth for thirty-four consecutive months. Of the 14 subsectors, 3 reported increased employment level, 1 subsectors remain unchanged, while the remaining ten subsectors recorded lower employment level in the review month (Fig. 6 and Table 5).
Raw material Inventories
The manufacturing sector inventories index contracted for the first time in March 2020. At 49.4 points, the index dipped when compared to its level in February 2020. Three of the 14 subsectors recorded growth, 3 subsectors reported unchanged inventories, while 8 subsectors reported lower raw material inventoriesin the review month (Fig. 7 and Table 6).
