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Manufacturing PMI Stands at 44.1% in October from 42.5% in September 2016 - CBN

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Wednesday, November 02, 2016 2:12pm/CBN

Data and Method of Presentation
The Manufacturing and Non-Manufacturing PMI Report on businesses is based on data compiled from purchasing and supply executives. Survey responses indicate whether there is change or no change in the level of business activities in the current month compared with the previous month. For each of the indicators measured, this report shows the diffusion index of the responses.

The diffusion index is computed as the percent of positive responses plus one-half of the percent of those reporting no change. The composite PMI is then computed as the weighted average of five diffusion indices for manufacturing sector: production level, new orders, supplier delivery time, employment level and raw materials inventory, with assigned weights of 25%, 30%, 15%, 10% and 20%, respectively.

The composite PMI for non-manufacturing sector is computed from four 2 diffusion indices: business activity, new orders, employment level and raw materials inventory, with equal weights of 25% each.

A composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding, 50 points indicates no change and below 50 points indicates that it is generally declining.


The sub-sectors reporting growth are listed in the order of highest to lowest growth. For the sub-sectors reporting contraction/decline, they are listed in the order of the highest to the lowest decline.

Manufacturing PMI Report
Production level, new orders, employment level and raw material inventories declining at a slower rate; supplier delivery time improving at a faster rate in October 2016

The Manufacturing PMI stood at 44.1 index points in October 2016, compared to 42.5 in the preceding month (Fig. 2 and Table 1), indicating a slowing decline in the manufacturing sector during the review period.

Fourteen of the sixteen sub-sectors surveyed recorded declines in the review month in the following order: electrical equipment; primary metal; fabricated metal products; petroleum & coal products; transportation equipment; computer & electronic products; printing & related support activities; nonmetallic mineral products; plastics & rubber products; furniture & related products; paper products; textile, apparel, leather & footwear; cement and chemical & pharmaceutical products.

The remaining two subsectors grew in the order: appliances & components and food, beverage & tobacco products.





Production Level
At 42.3 index points, the production level index for manufacturing sector declined for the tenth consecutive month, but at a slower rate than the index recorded in September 2016.

Thirteen manufacturing sub-sectors recorded declining production level during the review month in the following order: transportation equipment; petroleum & coal products; electrical equipment; primary metal; computer & electronic products; fabricated metal products; plastics & rubber products; furniture & related products; nonmetallic mineral products; printing & related support activities; paper products; textile, apparel, leather & footwear and chemical & pharmaceutical products.

The appliances & components and cement sub-sectors remained unchanged, while the food, beverage & tobacco products sub-sector grew in the review period (Table 2).



New Orders
The new orders index declined for the tenth consecutive month. At 40.3 points, the index declined at a slower rate when compared to the 38.7 index points in September 2016.

The fourteen subsectors that recorded declines in new orders were: computer & electronic products; transportation equipment; primary metal; fabricated metal products; electrical equipment; nonmetallic mineral products; printing & related support activities; plastics & rubber products; furniture & related products; paper products; petroleum & coal products; textile, apparel, leather & footwear; chemical & pharmaceutical products and cement.

The remaining two sub-sectors grew in the order: appliances & components and food, beverage & tobacco products (Table 3).



Supplier Delivery Time
At 57.7 index points, the supplier delivery time index for manufacturing sub-sectors improved at a faster rate in the month of October 2016. The index recorded improvements for the eighth consecutive month.

Thirteen sub-sectors recorded improving suppliers’ delivery time in the following order: petroleum & coal products; chemical & pharmaceutical products; plastics & rubber products; computer & electronic products; primary metal; furniture & related products; electrical equipment; paper products; fabricated metal products; printing & related support activities; textile, apparel, leather & footwear; cement and nonmetallic mineral products.


The appliances & components and transportation equipment sub-sectors remained unchanged, while the food, beverage & tobacco products sub-sector recorded worsening delivery time in October (Table 4).



Employment Level
Employment level index in the month of October 2016 stood at 42.2 points, indicating declines in employment level for the twentieth consecutive month. However, the index declined at a slower rate when compared with the level in the preceding month.

Of the sixteen sub-sectors, fourteen recorded declines in the following order: electrical equipment; printing & related support activities; nonmetallic mineral products; petroleum & coal products; chemical & pharmaceutical products; primary metal; paper products; plastics & rubber products; fabricated metal products; furniture & related products; cement; textile, apparel, leather & footwear; computer & electronic products and food, beverage & tobacco products.

The remaining two sub-sectors recorded growth during the review period in the order: transportation equipment and appliances & components (Table 5).



Raw Materials Inventory
At 42.9 index points, the raw materials inventory index declined for the tenth consecutive month in the review period. The index declined at a slower rate when compared with the previous month.

Of the sixteen sub-sectors, twelve recorded declines in raw materials inventories in the order: petroleum & coal products; furniture & related products; electrical equipment; printing & related support activities; paper products; fabricated metal products; primary metal; cement; textile, apparel, leather & footwear; nonmetallic mineral products; plastics & rubber products and chemical & pharmaceutical products.

The remaining four sub-sectors recorded growth in inventories in the order: transportation equipment; appliances & components; food, beverage & tobacco products; and computer & electronic products (Table 6).



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