Production costs grew the most in Nigeria’s industrial and agriculture sectors in January 2023, led by strong rises in energy and raw material costs, according to the Purchasing Managers Index (PMI).
According to Stanbic IBTC Plc’s PMI survey, the month of January saw a further strong pace of cost inflation that was considerably above the series average, with agriculture and manufacturing sectors posting the fastest rises in output prices.
The Index evaluates the month-to-month change in economic activity in the manufacturing sector as perceived by purchasing managers as expanding, stable, or declining. The PMI’s objective is to inform company decision-makers, analysts, and investors about present and prospective business conditions.
Readings above 50.0 indicate that business conditions have improved over the previous month, while readings below 50.0 indicate deterioration.
According to the study, Nigeria’s headline PMI fell to 53.5 in January from 54.6 in December.
However, it signaled a solid monthly strengthening of the private sector and the thirty-first in consecutive months, but the rate of improvement was the softest since August 2022.
The PMI report noted that although the rate of increases in overall input cost moderated in January, easing for the second month running to the softest for a year, nevertheless the input prices continued to rise sharply to the highest since May 2021 with cost pressure most pronounced in the manufacturing sector.
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