The latest Purchasing Managers’ index from the Stanbic IBTC Bank Nigeria shows that business activities in Nigeria’s private sector contracted in October.
This dip in business activities capped a six-month increase since March 2023.
According to the report, the headline PMI for October 2023 dropped to 49.1 from the 51.1 recorded in the previous month of September.
The report explained that any reading above 50.0 represents improvements in business conditions while readings below 50 signal a deterioration in business activities.
The report states,
The PMI report noted that the causes of the dip in business activities were an increase in the cost of inputs, missed payments from customers, currency weakness, etc. It explained inputs cost for October saw the highest increase since the survey began almost a decade ago.
It states,
The report also mentioned inflation especially transport and food inflation necessitated companies to increase staff salaries.
However, it explained that increased input costs and salary increases resulted in a hike in selling prices which stifled consumers’ demand.
The report reads,
The Head of Equity Research West Africa at Stanbic IBTC Bank, Muyiwa Oni said of the report,
On the positive side, the report noted that companies and businesses continue to hire at a solid pace portending plans to expand.
