The latest Purchasing Managers’ Index (PMI) by Stanbic IBTC Bank showed that the headline index rose to 52.4 in April, up from 51.9 in March, marking the third consecutive month above the 50.0 threshold, which separates expansion from contraction.

The uptick reflects a solid improvement in overall business conditions, with the pace of growth slightly stronger than in the previous month.

Demand Growth Drives Expansion

The April PMI data indicates that improving demand conditions remained central to the expansion. Businesses reported higher customer numbers, which translated into increased new orders and a corresponding rise in output.

However, the growth trajectory was not without constraints. Inflationary pressures, particularly those linked to higher fuel costs driven by the ongoing Middle East conflict, continued to weigh on business operations. These cost pressures moderated the pace of expansion in both new orders and overall activity.

Despite these challenges, output levels increased at a solid pace, slightly exceeding March’s performance. Growth was recorded across most sectors, although the services sector lagged behind.

Rising Costs Shape Business Decisions

Input costs remained elevated in April, with firms reporting significant increases in fuel and raw material prices. Purchase price inflation remained close to March’s 15-month high, underscoring the persistence of cost pressures.

In response, companies adjusted their pricing strategies. Selling prices rose sharply, reaching their highest level since December 2024, as businesses passed on increased costs to consumers.

Staff costs also edged higher, albeit modestly, as some firms raised wages to cushion employees against rising transportation expenses.

Employment and Capacity Pressures

While firms responded to higher workloads by hiring additional staff, the pace of job creation remained marginal and the weakest in three months. Capacity constraints persisted, with some companies citing staff shortages, delayed customer payments, and supply chain challenges.

As a result, backlogs of work increased for the third consecutive month, reflecting ongoing pressure on operational capacity.

Purchasing Activity and Supply Chains

Companies continued to ramp up purchasing activity, extending the current expansion streak to 17 consecutive months. Inventory levels also rose significantly, supported by stronger demand and efforts to secure materials amid price volatility.

Encouragingly, supplier performance showed slight improvement, with lead times shortening, although at the slowest pace recorded so far in 2026. Timely payments by firms helped facilitate smoother deliveries.

Business Confidence Improves

Business sentiment strengthened in April, with companies expressing optimism about future growth. Many firms outlined plans to expand operations through new branches, increased inventory, and entry into new markets.

Notably, about half of surveyed businesses expect output to rise over the next 12 months, reflecting improving confidence in the economic outlook.

Expert Insight and Economic Outlook

Commenting on the data, Muyiwa Oni, head of Equity Research, West Africa at Stanbic IBTC Bank, noted that the sustained expansion reflects resilient demand conditions, even as inflation continues to shape business decisions.

He added that the strong start to Q2 reinforces expectations of improved economic performance in 2026. The Nigerian economy is projected to grow by 4.22% year-on-year in 2026, up from 3.87% in 2025, driven largely by the non-oil sector.

The services sector is expected to remain a key growth driver, while ongoing government investment across critical sectors, including oil and gas, agriculture, manufacturing, and infrastructure, is likely to further support economic activity.

However, growth in the oil sector is projected to moderate, with output expected to average 1.70 million barrels per day, compared to 1.64 million barrels per day in 2025.

• Nigeria’s PMI reading of 52.4 in April underscores a resilient private sector, supported by improving demand and business optimism. While inflationary pressures, particularly fuel-related costs,  continue to pose challenges, the overall trajectory points to steady economic expansion and strengthening business confidence in the months ahead.

The numbers tell the story: both output and new orders rose sharply, surpassing September’s performance and signaling a stronger start to the final quarter of 2025.

Behind these numbers lies the Stanbic IBTC Purchasing Managers’ Index (PMI), the pulse-check of Nigeria’s private sector. The index climbed from 53.4 in September to 54.0 in October, marking the 11th consecutive month of expansion.

Readings above 50.0 point to improving business conditions, and October’s figures didn’t just sustain the momentum, they accelerated it.

The Story Behind the Numbers

For many Nigerian businesses, October felt different. The softening of price pressures and the rollout of new products breathed fresh life into demand.

Customers were not only spending again but also seeking innovation, pushing new orders up to 56.3 points, from 55.4 in September. In response, companies expanded operations, increased purchases, and even added new staff, a rare combination that reflected cautious confidence.

“Business activity started the last quarter of 2025 on a strong note,” said Muyiwa Oni, head of Equity Research (West Africa) at Stanbic IBTC Bank. “The headline PMI printed higher at 54.0 points in October, driven by higher output and new orders. Continued softening of price pressures and the launch of new products helped drive this momentum.”

Manufacturing led the pack, posting the fastest output growth among all four surveyed sectors, manufacturing, agriculture, services, and construction.

Overall, output reached 57.7 points, the highest since April, supported by increased domestic orders and improved supply chains.

Inflation Eases, But Not Uniformly

Inflation, long the Achilles’ heel of Nigerian business planning, showed tentative signs of restraint. Input costs rose again in October but at a much slower pace than the surges of 2023 and 2024. Output prices, the prices businesses charge customers, increased too, though at the second-slowest rate in five-and-a-half years.

Stanbic IBTC projects that headline inflation, which eased to 18.02% year-on-year in September, could moderate further to around 15.8%–16.2% in October and 14.2%–14.6% in November.

This anticipated cooling is largely tied to declining food prices during the main harvest season, which is expected to stabilize costs until December.

Non-food inflation, however, faces upward pressure due to higher fuel prices and temporary supply challenges linked to production glitches at the Dangote Refinery, which supplies up to 40% of Nigeria’s petrol.

Despite these hiccups, a more stable naira is expected to provide relief, keeping non-food inflation in check in the short term.

Jobs, Power, and Patience

While the improved outlook encouraged firms to hire, job creation remained modest. October marked the fifth straight month of employment growth, but power outages and delayed client payments limited the pace of expansion.

Some firms faced backlogs and operational delays, yet many kept optimism alive, nearly 46% of surveyed businesses expect output to rise over the next 12 months.

In the words of one manufacturing executive surveyed:

“We’re seeing demand again, but we’re being careful. Stability matters now more than ever, in prices, power, and policy.”

A Glimpse into 2025

Stanbic IBTC expects Nigeria’s economy to grow by about 4.0% in 2025, buoyed by lower inflation, a stabilizing exchange rate, and the potential for monetary policy easing in the months ahead. Both manufacturing and services are projected to expand more robustly than they did in 2024, with the PMI trends hinting at a stronger, more confident private sector.

As businesses continue to innovate, diversify, and rebuild trust in the economic system, Nigeria’s real sector appears to be learning to dance again, cautiously, but with steady steps forward.

Although new orders returned to growth, the rate of expansion was only modest and insufficient to result in a rise in business activity, which fell fractionally.

Employment continued to increase, however, as firms worked through outstanding business at a faster pace. Companies continued to contend with sharply rising input costs, with the rate of inflation quickening since July.

In turn, firms increased their own selling prices at a faster pace.

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 ticked up to 49.9 in August from 49.2 in July, but remained just below the 50.0 no-change mark and signaled a broadly stable picture for business conditions in the Nigerian private sector.

The stagnation in overall operating conditions was in line with the trend in business activity, which decreased fractionally for the second consecutive month.

Companies reported that demand remained muted amid strong inflationary pressures, but there were some signs of encouragement as new orders returned to growth.

New business was up slightly, reversing a decline seen in July. That said, the pace of expansion was much softer than the series average.

New business rose across three of the four monitored sectors, the exception being services. Employment also increased, extending the current sequence of job creation to four months.

Muyiwa Oni, head of Equity Research West Africa at Stanbic IBTC Bank commented:

“Nigeria’s headline PMI increased slightly to 49.9 points in August from 49.2 in July but remained just below the 50.0 no-change mark and signaled a broadly stable picture for business conditions in the Nigerian private sector. The stagnation in overall operating conditions was in line with the trend in business activity; Nigerian companies posted a fractional reduction in business activity during August, as was the case in July.

Although a renewed expansion of sales led some companies to increase their output, others reported that demand remained weak amid marked cost pressures.

Activity rose in the manufacturing and wholesale & retail categories but fell in agriculture and services.

On purchase prices, respondents noted higher costs for materials, most notably animal feed and paper, while logistics and transportation were also a source of inflation amid higher fuel prices. Some panelists noted the weakness in the USD/NGN pair.

The rate of output price inflation also quickened to a five-month high in August as just under half of all respondents signalled a rise in charges. The increase in output prices reflected the pass-through of higher costs to customers.

The Nigerian economy grew by 3.19% y/y in Q2:24, from 2.98% y/y in Q1:24, as oil sector growth was almost doubled that of Q1:24, even as the non-oil sector flatlined at 2.80% y/y, the same as in Q1:24. The lingering weakness in the non-oil sector continues to reflect elevated interest rates, persistent inflationary pressures, and local currency depreciation.

Across sectors, the Services sector remains the growth engine of the economy, contributing 69.3% to the real GDP growth rate (although down from 83.2% GDP growth contribution in Q1:24), with Industries and Agriculture contributing 20.5% and 10.2% respectively to real GDP growth.

Nonetheless, the contribution of information and communication – ICT (a major source of services sector growth) to the overall economic growth has been moderating since Q3:23.

However, gains from the oil sector have been proven to be compensating, keeping the overall economy on a 2.5-3.2% y/y growth path. For H2:24, the anticipated moderation in headline inflation should provide some respite for domestic demand. However, elevated interest rate and local currency depreciation remain headwinds for the non-oil sector.

Besides, weak growth in internet and telephone subscribers may continue to put a cap on the ICT’s growth, even with increased data traffic. Overall, we retain our 2024 growth forecast of 3.1%.”

Although modest, the latest rise in staffing levels was the fastest since last November. Rising staffing levels and muted new order inflows meant that firms were able to deplete their backlogs of work at the joint-fastest pace since June 2022. Input costs rose rapidly again midway through the third quarter.

The rate of purchase cost inflation hit a five-month high amid increases in prices for materials and transportation, with cost pressures exacerbated by currency weakness. Staff costs were also up as firms increased pay in response to higher living costs.

Higher input costs were often passed on to customers, and output prices subsequently increased at the sharpest pace in five months.

Sharply rising material costs and muted demand led firms to scale back purchasing activity, while stocks of inputs decreased for the first time in 17 months.

Moreover, the reduction in inventories was one of the sharpest on record, if COVID-19 pandemic months are excluded. Meanwhile, supplier lead times continued to shorten.

Business expansion plans meant that companies were optimistic that output will increase over the coming year.

Although rising from July’s record low, sentiment remained among the least optimistic since the survey began.

Rates of expansion remained slower than the respective series averages, however, as high prices continued to limit demand.

That said, there were further signs of inflation leveling off, with both purchase costs and selling prices rising at the slowest rates for a year.

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 52.1 in May, up from 51.1 in April and the highest since January. The latest reading signaled a modest improvement in business conditions in the Nigerian private sector, but one that was still less pronounced than the historical trend.

New orders increased solidly in May, extending the current sequence of growth to six months. Business activity was also up, and to the largest extent since January.

Muyiwa Oni, head of Equity Research West Africa at Stanbic IBTC Bank commented:

“The Stanbic IBTC headline PMI increased to 52.1 points in May from 51.1 in April – its highest level since reaching 54.5 points in January.

“This implies that Nigeria’s private sector activity maintained a better footing in May even as the rate of expansion remained slower than the series average as high prices continued to limit demand. Nonetheless, the purchase costs and selling prices increased at their slowest rates in a year, thereby supporting a sharper increase in both output and new orders relative to April”.

The Nigerian economy grew moderately by 2.98% y/y in Q1:24 from 3.46% y/y in Q4:23. From a structural perspective, the services sector remains the growth engine of this economy, contributing 83.2% to the real GDP growth rate, with industries and agriculture contributing 15.5% and 1.3% respectively to the real GDP growth.

As expected, the interest rate sensitive sectors experienced a slowdown in growth safe for the Manufacturing sector whose growth improved modestly, to 1.49% y/y, from 1.38% y/y in Q4:23 – albeit still lagging the 3-year average growth (2.40% y/y).

“The April and May headline PMIs point to a slight improvement in private sector activity in Q2:24, although still underwhelming compared to Q2:23.

“We expect domestic demand to remain weak relative to historical average, exacerbated by inflationary pressures which may likely peak in May. Besides, interest rates at unprecedented highs will continue to have a negative passthrough impact on the non-oil sector. However, because of an expected favorable base-effect induced oil sector’s growth, the overall economy is on course to grow by 3.51% y/y in real terms in Q2:24.”

Growth was recorded across all four monitored sectors, with the sharpest rise in manufacturing.

Anecdotal evidence pointed to improving customer demand amid signs of inflationary pressures easing. Although purchase costs continued to increase rapidly in May, largely due to currency weakness, the rate of inflation eased to a one-year low.

This was also the case with regard to selling prices. Staffing levels were broadly unchanged again, but efforts to help existing workers with higher living costs meant that employee expenses increased at a solid and accelerated pace midway through the second quarter.

The improvement in customer demand seen in May encouraged companies to expand their purchasing activity.

This, allied with positive expectations for future workloads, also led to an increase in inventories. Both input buying and stocks of purchases rose more quickly than in April.

Despite efforts to secure additional inputs, still high prices for materials meant that firms sometimes struggled to accumulate the necessary items to complete projects.

As a result, backlogs of work increased for the third consecutive month. Suppliers’ delivery times continued to shorten, with improved vendor performance linked to a range of factors including prompt payments and good arrangements with vendors in a competitive environment.

Lead times have shortened in each month since March 2023. Despite stronger expansions in output and new orders in May, business confidence waned and was the lowest since the survey nadir posted in February.

More than 43% of respondents remained optimistic in the year-ahead outlook for output, however, linked to plans for investment and business expansions, including the opening of new branches.

Nigerian private sector business activity dipped into contraction midway through the third quarter of the year as severe and strengthening price pressures acted to diminish demand.

Both overall input costs and output charges increased to the largest extent since the survey began almost a decade ago.

Inflation again reflected higher transportation costs as a result of the removal of the fuel subsidy, plus currency weakness. 

Rising transportation costs also caused supplier delivery delays. Meanwhile, rates of expansion in both new orders and employment eased and were only marginal. 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 dropped for the third month running to 50.2 in August, from 51.7 in July, and was the lowest in the current five-month sequence of improving business conditions. The index signaled only a marginal monthly strengthening of the health of the private sector.

Marked inflationary pressures remained a key hindrance to businesses in August. Overall input costs increased to the greatest extent since the survey began in January 2014 as close to three-fifths of respondents posted a rise over the month. Rates of increase in both purchase prices and staff costs accelerated, the latter hitting a new survey peak.

Higher transportation costs were central to rising prices, while there were also reports of currency weakness adding to inflationary pressures. In turn, companies also increased their selling prices at a record pace, with the rate of inflation surpassing the previous peak from December 2021.

Steep price rises presented a challenge for firms to secure new orders. August saw only a marginal increase in new business, with the rate of expansion the softest in the current five-month sequence of growth. Similarly, employment also rose only marginally. Meanwhile, business activity decreased slightly midway through the third quarter, ending a four-month period of expansion.

Sector data pointed to a drop in activity in wholesale & retail and no change in services. 

Meanwhile, agriculture and manufacturing continued to see output increase. Companies continued to expand their purchasing activity, with stocks of inputs rising accordingly.

There were some difficulties in the receipt of inputs caused by high transportation costs. As a result, suppliers’ delivery times shortened only fractionally in August, following a period of marked improvements in recent months.

Business sentiment picked up from the previous survey period’s record low, but was still historically weak.

Those panellists predicting a rise in output over the year ahead often linked this to business expansion plans and advertising activity.

In fact, output and new orders fell more quickly than in February, while staffing levels and purchasing activity were scaled back again.

While input costs and output prices continued to rise sharply, rates of inflation softened. Output prices increased at the softest pace in almost three years.

Meanwhile, suppliers’ delivery times shortened after having lengthened in February.

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

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

The headline PMI posted 42.3 in March from 44.7 in February, moving further below the 50.0 no-change mark and signaling a sharper deterioration in business conditions in the Nigerian private sector.

The decline was the most pronounced since the survey began in January 2014, apart from at the time of the outbreak of the COVID-19 pandemic in 2020.

As was the case in February, there were widespread reports from companies that customers were unable to commit to spending given cash shortages. This led to a substantial decline in new business, with the pace of contraction more pronounced than in the previous survey period.

The same picture was seen with regard to business activity, which decreased at a rate only exceeded in April and May 2020.

All four broad sectors posted reductions in activity at the end of the first quarter. Companies reduced staffing levels slightly for the second month running, in part reflecting lower workloads but also due to difficulties paying wages. Lower workforce numbers limited the pace of staff cost inflation, which eased to a marginal rate that was the slowest since January 2021.

Stanbic IBTC Bank Purchasing activity was also scaled back, falling at the fastest pace since May 2020. In turn, inventory holdings also decreased. Inflationary pressures eased in March. The pace at which purchase costs increased was the slowest in just under three years but remained sharp and faster than any seen prior to the pandemic. The same picture was seen with regard to output prices, which rose at the slowest pace since April 2020. Suppliers’ delivery times shortened in March, following the first lengthening in more than five years during February.

Suppliers’ delivery times shortened in March, following the first lengthening in more than five years during February. Quicker deliveries reportedly reflected competition among suppliers.

The cash crisis acted to dampen confidence in the private sector in March, with sentiment the second lowest in the series’ history. Where output was predicted to rise, panelists linked this to investment intentions and business expansion plans.

At the same time, backlogs increased for the second month in a row, with sustained accumulation of outstanding business suggesting that hiring activity could continue in the months ahead.

On the price front, price pressures showed further signs of abating with the overall rate of input cost inflation the weakest for three months, but still marked by historical standards. Selling prices were also raised, albeit at a softer rate than that seen in September.

The headline figure derived from the survey is the 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.

According to Stanbic IBTC, the headline PMI posted at 53.6 in October, little-changed from 53.7 in September, indicating a solid improvement in the health of the private sector.

A key driver of growth was a sharp rise in new orders following reports of favourable and improving market conditions.

In turn, firms raised their output levels and for the fourth month in a row. Moreover, the rate of increase was quicker than the long-run series average. Manufacturing firms registered the strongest increase in output, followed by services, wholesale & retail and finally agriculture.

Backlogs increased for the second month in a row during October, but the rate of increase eased from that in September. Firms subsequently continued hiring activity, but the rate of growth was mild, and the joint-weakest in the current 21-month sequence of job creation.

Sustained expansions in new orders led Nigerian private sector firms to raise their purchasing activity, with the rate of growth quickening on the month.

Pre-production inventories also rose robustly, with the rate of growth quickening to a three-month high amid firms’ efforts to boost their stockpiles.

Supply-chain performance improved, with lead times now shortening in each month for the last five years. Meanwhile, prices data revealed another month of overall input price inflation.

Higher purchase and staff costs underpinned the latest rise which eased from September, but was sharp and historically elevated, nevertheless.

Selling prices also rose, but at the weakest pace for almost two years.

Whilst firms maintained an optimistic view towards output in the next 12 months, the degree of positivity was the second lowest in the series history, with that only recorded in September 2020 weaker.