The Nigerian private sector maintained a robust growth trajectory as 2025 drew to a close, fueled by resilient customer demand and a significant surge in business optimism.
The latest Stanbic IBTC Bank Purchasing Managers’ Index (PMI) report reveals that despite a slight moderation in the headline figure, the country’s business environment remains firmly in expansion territory, marking thirteen consecutive months of strengthening operating conditions.
Growth Sustained by Demand
The headline PMI posted 53.5 in December, a marginal dip from 53.6 in November. In the PMI framework, any reading above 50.0 indicates an improvement in business conditions.
This latest figure aligns with the 2025 average, signaling a solid end to the year.
The primary driver for this expansion was a “marked monthly increase” in new orders. High customer demand encouraged firms across all four monitored sectors, Agriculture, Manufacturing, Services, and Trade, to ramp up output, with Agriculture leading the charge.
Inflationary Pressures and Festive Spending
While the outlook remains positive, the report noted a pickup in inflationary pressures. Overall input prices rose to 64.4 in December (up from November’s 61.9).
Muyiwa Oni, head of Equity Research West Africa at Stanbic IBTC Bank, suggested this uptick is likely tied to the higher spending patterns of the December festive season.
“Because of this high input cost, selling prices also increased in December, with the most significant price hike seen in the Manufacturing sector,” Oni noted. Despite the monthly rise, the rate of inflation remains weaker than the 2025 average.
Key Economic Indicators (December 2025)
| Metric | Status | Trend |
| Headline PMI | 53.5 | Expansion (Solid) |
| Business Confidence | 6-Month High | Improving Sharply |
| New Orders | Increasing | 14th Consecutive Month |
| Employment | Marginal Growth | Slowest since June 2025 |
| Input Prices | 64.4 | Increasing (Festive Impact) |
A Bright Outlook for 2026
Perhaps the most striking takeaway from the December report is the sharp improvement in business sentiment.
Nearly 59% of respondents predicted growth in the coming year, a six-month high.
This optimism is rooted in planned investments, the opening of new branches, and strategies to boost product exports.
Economic Forecasts:
- 2025 GDP Growth: Estimated at 3.8% y/y.
- 2026 GDP Growth: Projected to accelerate to 4.1% y/y.
- Headline Inflation: Estimated at 32.34% y/y for December 2025.
Strategic Drivers
The report identifies several “forward-linkage” factors that will likely support the economy in 2026:
The Dangote Refinery: Expected to continue impacting multiple sectors through increased local production capacity.
Government Intervention: Visible progress in infrastructure, livestock development, and the easing of trade constraints.
Macro-Stability: Potential interest rate cuts and exchange rate stabilization are expected to boost private consumption and business investment in the coming year.
“We see more sectors contributing to real GDP growth in 2026 compared to 2025,” Oni stated, “likely translating to an improvement in the quality of life for citizens.”
While the report highlighted minor bottlenecks, such as power supply issues, material shortages, and poor road conditions, the overarching narrative for Nigeria’s private sector is one of resilience and expansion as it enters the new year.
