The Purchasing Managers’ Index (PMI) of Stanbic IBTC for the month of September has shown that 49 per cent of business in the country carried out an upward review of the prices of products and services in the review period.
This is just as it showed that business conditions in the country continue to remain worse at 49.8- a below 50 reading for the third consecutive month.
According to the report, the cost of inputs for businesses rose at the sharpest rate in six months as output decreased for the month.
The report further showed that weakness in the naira for the month coupled with increase in petrol prices worsened transportation and logistics cost, which was passed on to consumers.
“Purchase prices rose rapidly amid currency weakness and higher costs for fuel, logistics, materials and transportation. Some firms made efforts to help their workers with higher living costs, but the rate of wage inflation eased to an 18-month low. Higher costs were then passed through to customers, with close to 49% of respondents raising selling prices in September.”
The report also showed that although sharp price increases limited customer demand, new orders rose for the second consecutive month in September, slightly exceeding August’s increase, but business activity continued to decline marginally as the improvement in new orders was insufficient to boost output, marking the third consecutive monthly decrease in activity.
It noted that whereas output increased in agriculture and manufacturing, it declined in wholesale & retail and services and employment grew for the fifth month in a row, but only marginally, as some firms limited hiring to reduce costs.
The Stanbic IBTC PMI also indicated that business confidence fell in September, marking the second-lowest level on record.
