Business activities in Nigeria remained flat in March, according to the latest Purchasing Managers’ Index published by Stanbic IBTC.
The report indicated that the headline index remained unchanged at 51 points in March from 51 points in February.
Readings above 50 points signal an improvement in business conditions, while those below show a drop.
Some of the key findings of the report included purchase costs and output prices rising at the sharpest rates on record, a slower rise in new orders and employment being down for the second month running.
The report said, “The impact of currency weakness on the Nigerian private sector was evident again in March. Purchase costs rose at the sharpest rate on record, meaning companies increased their own selling prices at an unprecedented pace.
“The rate of expansion in business activity ticked higher, but steep price rises acted to limit demand and the pace of new order growth eased to a four-month low. Meanwhile, employment decreased for the second month running.”
It added that headline PMI at 51.0 in March was the joint-lowest in four months, pointing to a “slight improvement in business conditions during the month and one that was softer than the series trend”.
“Price pressures remained elevated in March. The rate of purchase price inflation hit a fresh record high for the second consecutive month, largely due to the impact of currency weakness. There were also some reports of higher transportation costs. Employee pay was also increased in response to cost-of-living pressures, resulting in the sharpest rise in staff costs since last November.
“In line with the picture for purchase costs, the rate of output price inflation was also the steepest since the series began in January 2014, as close to 69 per cent of respondents increased their charges over the month. With prices rising sharply, firms faced challenges securing new orders.
Although new business increased for the fourth month running as some companies noted greater client interest, the rate of expansion was the softest in the current sequence of growth. The rate of expansion in business activity quickened slightly from February, but remained relatively modest,” the report partly stated.
In terms of employment, the report said it was down for the second month running, while increases in activity were seen in each of the agriculture, manufacturing, wholesale & retail and services categories.
The Stanbic IBTC Bank Nigeria PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 private sector companies.
