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CBN Records Manufacturing PMI of 61.1% in December 2018

 

Introduction

The December 2018 PMI survey was conducted by the Statistics Department of the Central Bank of Nigeria during the period December 10-14, 2018. 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) (Fig. 1). 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.

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Fig. 1: Map of Nigeria Showing the 36 States and the FCT

Data and Method of Presentation

The Manufacturing and Non-Manufacturing PM! 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 subsectors reporting 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

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The Manufacturing PMI in the month of December stood at 61.1 index points, indicating expansion in the manufacturing sector for the twenty-first consecutive months (Fig. 3 and Table 1). The index grew at a faster rate when compared to the index in the previous month. Thirteen of the 14 subsectors surveyed reported growth in the review month in the following order: transportation equipment; furniture & related products; printing & related support activities; textile, apparel, leather & footwear; plastics & rubber products; chemical & pharmaceutical products; food, beverage & tobacco products; nonmetallic mineral products; paper products; fabricated metal products; cement; electrical equipment; and petroleum & coal products. The primary metal subsector recorded decline in the review period.

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Production Level

At 63.6 points, the production level index for the manufacturing sector grew for the twenty-second consecutive months in December 2018. The index indicated a faster growth in the current month, when compared to its level in the preceding month. Ten of the 14 manufacturing subsectors recorded increased production level, 3 remained unchanged while 1 recorded decreased production level (Fig. 4 and Table 2).

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New Orders

At 62.3 points, the new orders index grew for the twenty-first consecutive months, indicating increase in new orders in December 2018. Thirteen subsectors reported growth, while 1 contracted in the review month (Fig. 5 and Table 3).

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Supplier Delivery Time

The manufacturing supplier delivery time index stood at 58.4 points in December 2018, indicating faster supplier delivery time. The index has recorded growth for nineteen consecutive months. Thirteen subsectors recorded improved suppliers’ delivery time, while 1 remained unchanged (Fig. 6 and Table 4).

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