A report from the Central Bank of Nigeria (CBN) has indicated that Nigeria’s economic activities expanded for the second consecutive month.
The composite Purchasing Managers’ Index (PMI) for January 2025, at 50.2 index points, signaled an expansion in economic activities for the second straight month.
Three sectors—industry, services, and agriculture—stood out in the report. The Industry Sector improved from a stationary position in December 2024 to an expansionary level in January 2025. Conversely, the Services Sector index indicated a contraction in economic activities for the month, while the Agriculture Sector registered expansion for the sixth consecutive month.
The breakdown of the index showed that composite output, new orders, and employment levels recorded growth at 50.9, 50.2, and 50.2 points, respectively, reflecting overall expansion during the review period.
However, the composite stock of raw materials declined to 49.8 points, and the suppliers’ delivery time slowed further to 49.6 index points, suggesting delays in supply chains.
Analysis of the 36 sub-sectors
An analysis of the 36 sub-sectors reviewed across industry, services, and agriculture indicated that 17 sub-sectors reported growth in economic activities, with the transportation equipment sub-sector recording the highest expansion. Conversely, 17 sub-sectors experienced a decline, with forestry posting the steepest contraction, while two sub-sectors remained unchanged.
The Industry Sector PMI revealed that out of the 17 sub-sectors surveyed, 10 recorded expansions, six showed contractions, while the plastic and rubber products sub-sector remained stable.
Transportation equipment emerged as the leading sub-sector in terms of expansion, whereas the Non-metallic mineral products sub-sector experienced the highest level of contraction. The overall industry sector index stood at 51.3 points, confirming an expansion in industrial activities for January 2025.
Breakdowns in the Industry Sector indicated that output and employment levels grew, standing at 54.0 and 52.4 points, respectively.
What you need to know
- Meanwhile, new orders and stock of raw materials both declined to 49.6 points. Suppliers’ delivery time also remained sluggish, recording 49.6 index points.
- Conversely, the Services Sector experienced a contraction, as reflected in its PMI of 48.6 points for January 2025.
- Among the 14 sub-sectors assessed, only three recorded expansions, and 10 experienced contractions, while the management of companies sub-sectors remained stationary.
- Motion pictures, cinema, sound recording, and music production recorded the highest expansion, whereas transportation and warehousing experienced the most significant contraction.
Business activities (output), new orders, stock of raw materials, and employment levels declined to 48.8, 48.6, 48.6, and 48.4 points, respectively, highlighting a slowdown in the sector.
The Agriculture Sector, however, continued its positive trajectory, recording an overall index of 52.5 points, indicating expansion. Out of the five sub-sectors surveyed, four experienced growth, while one contracted.
Crop production led to expansion, whereas forestry posted a decline. Additionally, output, new orders, employment, and stock of raw materials within the agriculture sector all reflected growth, standing at 51.8, 54.3, 51.3, and 52.4 index points, respectively.
A PMI reading above 50.0 points signals an expansion in business activities, while a reading below 50.0 points suggests a contraction. An index of exactly 50.0 points signifies no change in economic conditions.
