Stanbic IBTC Bank has released the Purchasing Managers’ Index (PMI) data for Nigeria’s private sector for February 2022, which it noted to be “highest in two years amid stronger demand.”
The latest rating, which increased to 57.3 from 53.7 recorded in January 2022, shows improvement in business conditions.
“At 57.3 in February, up sharply from 53.7 in January, the latest expansion pointed to a robust overall improvement in business conditions. Moreover, the latest figure signalled the strongest expansion since November 2019.
“A key driver of growth was the joint-quickest rise in new orders for over two years. Firms mentioned a general improvement in demand from both domestic and international markets,” Stanbic IBTC Bank stated.
The bank attributes the increase to “quicker expansions in output, new orders, employment and purchasing.
“At the same time, firms were hopeful that higher investments and customer numbers would support output growth over the course of the coming year,” it noted.
However, the bank noted that unfavourable exchange rate movements and fluctuations, higher prices of raw materials and rising wages led to a substantial rate of input price inflation.
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On a sub-sector basis, there was broad expansion, especially with wholesale and retail followed by services, agriculture and manufacturing.
The index noted that “higher workloads led companies to raise their staffing levels in February, which they did so at a rate that was the quickest since last July. As a result, wages rose at the second-quickest rate in the series history.”
It also noted that “sustained periods of output growth as well as improving demand for Nigerian products and services led to higher levels of input buying. In a bid to meet future orders, firms added to their inventories.
“Vendor performance continued to improve during the month as a result of increased competition amongst vendors, advance payments and timely order requests.”
It further stated that in February, favourable demand conditions underpinned optimism as firms that foresee a rise in output expect business expansions, higher client numbers and greater investment over the coming months.
“Supportive demand conditions allowed firms to pass on a large proportion of their cost burdens with selling charges rising substantially.”
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February PMI highest in two years amid stronger demand ― Stanbic IBTC Bank
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