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Nigeria’s manufacturing Purchasing Managers’ Index up 68.7 in Dec 2017
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By Ebenezer Ademola
January 2, 2018 12:14:44pm GMT      |      Views: 364
Segments of manufacturing GDP, Q3 2017

WorldStage Newsonline-- Nigeria’s manufacturing Purchasing Managers’ Index soared from 60.1 to 68.7 in December 2017, according to a report by FBNQuest Research of the FirstBank on Nigeria.

According to the latest reading (no 57), the seasonal boost to demand for the end-year holidays also fueled the surge.

“The reading for output, for example, is the second highest on record. However, we note that January has brought a decline in the headline reading, sometimes sharp, each year since the launch of our index. The falls in January 2014 and 2017 were particularly severe,” the report said. 

“There had been a general transformation in access to fx since Q1 2017 due to the CBN’s opening of several fx windows.

“One year ago, fx was scarce and there was a sizeable backlog of unmet demand. In contrast, fx is now widely available. Local substitution has also removed some fx demand. Its impact remains small, and the agro-processing segment seems to be the main practitioner.

“The national accounts, unlike a PMI, are a historical indicator. The latest series (for Q3 2017) shows an acceleration in GDP growth from an upwardly revised 0.7% in the previous quarter to 1.4% y/y. Oil GDP grew by 25.9% y/y and 21.1% q/q, which mirrors the improved stability in the Niger Delta. For the non-oil economy, the data show y/y contraction of -0.8% and q/q expansion of 7.8%. On the basis of q/q GDP data, we can track correlation with our monthly PMI readings. Manufacturing achieved growth of 2.6% q/q in Q3 2017. Food, beverages and tobacco, its largest segment, grew by 0.6% q/q. Meanwhile, textiles, apparel and footwear achieved close to 8% growth q/q. Investment in backward integration, support for cotton growers from state governments and fx availability for machinery could all have played a part.”

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