According to the Business Expectations Survey (BES) report for June 2025 by the Central Bank of Nigeria, the Confidence Index stood at 20.7 index points in June, reflecting the positive feedback among respondents about the macroeconomy.

The report noted that this optimism is expected to continue over the next six months. Confidence in the industry and agriculture sectors is projected to more than double within that period, with the industry sector confidence index expected to rise from 23.1 to 48.3 index points, and the agriculture sector to 42.8 index points.

Respondents were optimistic that the volume of business activity for July 2025 and subsequent months will increase, signalling economic growth.

However, businesses still face challenges constraining them, including high interest rates, insecurity, and insufficient power supply were identified as the top three constraints to businesses, as the survey highlights ten major challenges constraining businesses:

• High Interest Rate: 75.6% of respondents identified this as their major constraint.
• Insecurity: 75.2% of respondents identified this as their major constraint.
• Insufficient Power Supply: 74.3% of respondents identified this as their major constraint.
• High Taxes: 73.2% of respondents identified this as their major constraint.
• Financial Problems: 68.9% of respondents identified this as their major constraint.
• High Bank Charges: 68.7% of respondents identified this as their major constraint.
• Unfavourable Economic Climate: 67.8% of respondents identified this as their major constraint.
• Unclear Economic Laws: 67.4% of respondents identified this as their major constraint.
• Unfavourable Political Climate: 62.5% of respondents identified this as their major constraint.
• Poor Infrastructure: 62.4% of respondents identified this as their major constraint.

The BES is a monthly survey of leading firms drawn from the Business Establishment frame of the Central Bank of Nigeria and the Nigerian Bureau of Statistics. The findings from the report reflect the current economic challenges affecting businesses in the country while identifying perceptions of businesses on economic indicators like inflation, exchange rate, among others.

Steep price pressures acted to limit the pace of growth in the Nigerian private sector as business confidence hit a new low in July, according to Stanbic IBTC Purchasing Managers’ Index (PMI).

Overall input costs rose at a pace unsurpassed in more than nine-and-a-half years of data collection, with selling prices up rapidly in response. 

Rising price pressures impacted demand, with growth of both new orders and business activity softening as the second half of the year got underway.

Meanwhile, the Stanbic IBTC Bank PMI indicates that ‘business confidence hit a new low’, in the month under review. 

There was more positive news on the employment front, however, as the rate of job creation quickened to the fastest since January. 

The headline figure derived from the survey is the Stanbic IBTC Purchasing Managers’ Index (PMI).

Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration. 

The headline PMI posted above the 50.0 no-change mark for the fourth month running in July and thereby signaled a further improvement in business conditions in the Nigerian private sector during the month.

That said, at 51.7 the index was down from 53.2 in June and pointed to a modest strengthening of operating conditions that was the least pronounced in the current expansionary sequence.

The softer improvement in the health of the private sector reflected trends in output and new orders during July.

In both cases, rates of growth eased to the weakest since the respective returns to expansion following the cash crisis at the start of the year. 

While some firms reported having been able to secure new contracts amid rising customer numbers, others highlighted the negative impact on demand of rising prices. 

July data signaled a steep increase in overall input prices, with the rate of inflation the joint-fastest since the series began in January 2014, equal to that posted in November 2021.

Purchase costs were a key driver of overall input price inflation. Higher fuel costs following the subsidy removal and currency weakness were the main factors leading purchase prices to rise. Meanwhile, staff cost inflation hit a six-month high as firms increased pay to help staff deal with rising transport costs.

With input costs up rapidly, companies increased their output prices accordingly, and at one of the strongest rates on record. More than half of companies increased their charges over the month.

More positively, employment increased for the third month running in July, and at a solid pace that was the fastest since the start of the year.

Backlogs of work continued to rise, however, as some firms reported delays while checks were made to make sure customers were able to pay for orders. Input buying and stocks of purchases rose further, but rates of increase softened.

Finally, business confidence continued to trend downwards in July and was the lowest in just over nine-and-a-half years of data collection.