PMI: Rising production costs threaten manufacturing recovery

Nigeria's manufacturing sector may struggle to maintain its recovery trajectory unless significant challenges related to rising production costs are addressed, according to analysts. Despite some positive indicators, deeper issues persist within the industry.

The Purchasing Managers’ Index (PMI) for manufacturing saw a marginal increase, moving to 50.10 in June from 49.6 in May. This slight improvement suggests a stabilization in business activity, inching closer to the 50-point mark that separates expansion from contraction.

However, experts caution that this modest gain masks underlying difficulties. Persistent cost pressures, including those related to raw materials, energy, and logistics, continue to weigh heavily on manufacturers. Without effective measures to mitigate these rising expenses, the sector's ability to sustain growth and contribute to economic recovery remains uncertain.