Private sector economic activity in Nigeria further accelerated in April, according to survey data that was recently released by the CBN, reinforcing sentiments that a consolidation of the economic gains witnessed in 2017 is underway.
According to the report, Manufacturing PMI rose for the 13th consecutive month to 56.9 points (previously: 56.7 points), amid faster growth in Supplier delivery time, Employment level, and Raw materials/WIP Inventory. Similarly, Non-manufacturing PMI improved for the 12th consecutive month, rising to 57.5 points (previously: 57.2 points) as gains in Business Activity, Level of new orders, Level of employment and Inventory, buoyed the index.
We think that the April PMI data, coupled with impressive earnings announcement by most companies, support increasing momentum in the economy, factoring in the strong historical relationship (80.2%) between both variables since the PMI series began in 2014. Notably, the PMI has remained comfortably above the 50 points thresholds for the fourth consecutive month in 2018, indicating robust growth in the real sector as well as encouraging macroeconomic conditions in the overall economy. Looking ahead, we expect a recovery in the services sector to bolster growth amid oil market stability.
UNITED CAPITAL NIGERIA