The NESG-Stanbic IBTC Business Confidence Monitor (BCM) showed an increase in the Current Business Index to +12.29 in April 2025 from +6.58 in March 2025.

This performance is driven by improvement in business conditions and the uptick in business activities.

A sub-sectoral analysis indicated weakly positive outcomes across all economic sectors included in the index.

Notable strong performances were recorded in Trade (+25.12) and Non-manufacturing (+23.59), followed by Manufacturing (+8.78), Agriculture (+7.02), and Services (+6.54).

While all sectors improved relative to their March 2025 performance, the Trade sector recorded the most significant leap, from +0.51 in March to +25.12 in April.

The rise coincided with two major festivals that typically drive higher spending on food, clothing, and household goods.

Despite the generally positive trend, structural challenges continued to dampen overall business growth. The general business situation remained positive, with improvements in production levels, operating profits, cash flow, and employment.

However, the cost of doing business slightly worsened, rising to +51.79 in April from +48.44 in March 2025. The most significant negative indicators were reduced investment (-15.00) and declining price levels (-16.62).

These factors, combined with other weak business conditions, collectively slowed business activity and growth in April 2025.

Persistent power shortages, high commercial lease/rental property costs, limited access to financing, inadequate foreign exchange availability, and unclear economic policies emerged as key constraints to business expansion.

High commercial lease/rental property costs remained a notable challenge for the second consecutive month, highlighting their disruptive effect on business operations.

Similarly, restricted access to financing continued as a structural barrier, further limiting business growth throughout the month.

According to Stanbic IBTC, the current business conditions amongst Nigerian businesses improved further to their highest level since we began coverage of the Business Confidence Monitor (BCM) over seven months ago.

This is as business activity improved across all the sectors covered by the survey, with Agriculture returning to positive in April from a negative index in March.

The notable recovery in Agriculture at the start of Q2:25 reflects off-season harvest in the Northern region of the country, which ensured there were strong gains in crop production and Agro-allied activities during the month. Another significant improvement indicated by the survey was in the Trade sector, coinciding with the festivities witnessed in the month, which drove higher consumer spending on household goods, food, and clothing. Overall, production level, demand condition, financial performance and employment levels improved in April relative to March, while cost pressures remained, and there was a dip in the investment index.

Meanwhile, businesses remain cautiously optimistic regarding an improvement in the business environment over the next one to three months, although the Trade sector witnessed the highest level of optimism in near-term business prospects. Nigeria’s business conditions started Q2:25 on a positive note, and we expect this trend to be maintained, albeit relatively slower than witnessed in Q1:25. This is as the local currency is expected to depreciate in Q2:25 compared to Q1:25 amid the lingering global uncertainties. This could also lead to a slightly higher inflation rate than seen in Q1:25, but it is still expected to remain softer compared to the 2024 average. Nonetheless, interest rates are likely to be lower this year amid moderate inflationary pressures, thereby helping to support economic growth over the medium term. On balance, we still maintain our expectation that the Nigerian economy is likely to grow by 3.5% y/y in real terms in 2025 relative to 3.4% y/y growth in 2024. Disclaimer

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According to the latest NESG-Stanbic IBTC Business Confidence Monitor report, the forecast is based on the premise that headline inflation is expected to remain sticky in September 2025 but settle below 30.0% from September 2025, as high petrol cost gets smoothened out of the year-on-year headline inflation, barring any unexpected negative shocks to petrol prices.

Inflation remains a central concern for Nigeria’s economy, with rising fuel costs and currency depreciation driving up expenses across all sectors.

The report stated,

“We expect headline inflation to remain sticky in 9M:25 but settle below 30.0 per cent from September 2025 as high petrol cost gets smoothened out of the year-on-year headline inflation, barring any unexpected negative shocks to petrol prices.

“This expectation, in addition to our prognosis on the USD/NGN pair, fiscal deficits, and food supplies, informs our forecast that the headline inflation may average 30.5 per cent y/y in 2025 and settle at 27.1 per cent by December 2025.”

“In our view, this could induce the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) to switch to an accommodative monetary policy stance in late 2025.

A relatively lower headline inflation in H2:24 should support consumer spending, and business activity should also improve as the impact of the government’s two-flagship policies (FX liberalization and fuel subsidy removal) subside.

“Overall, we estimate the Nigerian economy to grow by 3.5% y/y in 2025 from an estimated 3.2% y/y in 2024.

“The anticipated easing of inflation is also expected to influence monetary policy. According to the report, the Central Bank of Nigeria’s Monetary Policy Committee may adopt a more accommodative stance in late 2025, potentially reducing interest rates to stimulate economic activity.”

The report further highlighted that business performance in December 2024 experienced a slight recovery due to seasonal festive demand.

The Current Business Performance Index, which measures economic activity across sectors, rose to +0.77, an improvement from -2.74 recorded in November.

This marked the first positive reading since September 2024, reflecting a modest uplift in business activity.

However, the performance across sectors was uneven. Agriculture emerged as the top-performing sector with a net balance of +13.93, spurred by heightened harvest activities and increased demand for produce.

Non-manufacturing industries also showed resilience, recording a net balance of +5.80. In contrast, the manufacturing, trade, and services sectors faced significant challenges.

The Future Business Expectation Index, which reflects optimism about future business conditions, settled at +28.61 in December 2024, down slightly from +33.17 in November.

Despite the decline, the index still indicates cautious optimism among businesses for improved conditions in the first quarter of 2025, particularly in agriculture, manufacturing, and non-manufacturing sectors.