Nigerian PMI Drops Amid Rising Inflation and Fuel Prices, Highlighting Business Struggles

The Purchasing Managers’ Index (PMI) in Nigeria declined significantly from 49.8 in September to 46.9 in October 2024, indicating notable challenges faced by Nigerian companies. This data aligns with the October Stanbic IBTC PMI report, reflecting the impact of rising inflation and economic pressures on the business environment.

According to the report, "The headline PMI dropped to 46.9 in October from 49.8 in September, signaling a marked deterioration in business conditions that was the most pronounced since March 2023. Central to the worsening business environment in October was an intensification of already strong inflationary pressures. Overall input prices surged higher, with the latest rise the third-fastest in the survey’s history."

The decline in business conditions also coincides with a persistent nationwide increase in Premium Motor Spirit (petrol) prices, which surged to between N1,060 and N1,300 per litre in October. This was a steep rise from the average price of N626.21 per litre in September 2023.

Additionally, the naira’s value saw considerable depreciation, trading at N1,666.72 per dollar in November 2024, compared to N942 during the same month the previous year. These factors have contributed to a higher cost of living, reducing the purchasing power of many Nigerians.