Forex rate : Don says impact positive on PMI

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FOREX: Don says impact positive on PMI

By Simon Akoje

A don, Dr Michael Akur, says current efforts by Federal Government to stabilise the foreign exchange rate will impact positively on the country’s Purchasing Managers’ Index (PMI).

Akur, who teaches Economics and Statistics at University of Jos, made the assertion in a telephone interview with the News Agency of Nigeria (NAN) on Wednesday in Lagos.

The don said that the current low pressure on the naira had helped to drive productivity which would in a while reduce unemployment rate in the country.

PMI is an indicator of the economic health of the manufacturing sector. It is derived from the monthly surveys of private sector companies.

The data are collected through a survey of 400 purchasing managers in the manufacturing sector in different fields.

The fields are production level, new orders from customers, speed of supplier deliveries, inventories, order backlogs and employment level.

The Central Bank of Nigeria (CBN) said that PMI stood at 52.9 per cent in June, up from the 52.5 per cent in May.

Akurs advised that the current policy to boost productivity should be maintained to further improve the index.

“The country’s market is big enough to change the current trade narratives if our domestic manufacturers are better positioned.

“The apex bank’s monitoring group should ensure that the domestic currency is stable against other foreign currencies because the country is an import-driven one,” he said.

He said the government policy to boost power generation in business clusters must be sustained to further improve the PMI, while importation of good manufactured at home should be curtailed.

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