Nigerian businesses have shown resilience in the face of economic challenges, as reflected by the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index (PMI), which recorded a slight decrease to 52.0 in January from 52.7 in December. Despite this moderation, the PMI remains above the crucial 50.0 mark, signaling continued expansion within the private sector for the second consecutive month.
The improvement in business activity and new orders highlights increasing customer demand and companies’ readiness to invest in new projects. While growth has slowed slightly, business confidence has reached its highest level in over a decade, with companies optimistic about future expansion plans and favorable market conditions.
Key indicators show that business activity continues to expand as firms respond to rising demand. Employment levels increased for the second month in a row, signaling optimism for long-term growth. Additionally, inflationary pressures eased, with input costs and output prices rising at a slower pace than in December, providing businesses with a more stable cost structure.
Sectoral trends show growth in three of the four monitored sectors, excluding wholesale and retail. Improved supplier delivery times and faster payment cycles have helped stabilize supply chains. Though inflation remains a concern, it has slowed significantly, and analysts project that inflation will continue to moderate in 2025.
Despite a slight slowdown in growth, the Nigerian non-oil sector is expected to see a 3.2% year-on-year increase in 2025, driven by manufacturing, trade, ICT, and financial services. The improved business outlook and hiring trends suggest that businesses are strategically positioning themselves for growth in the face of ongoing challenges, especially in sectors like agriculture.
Source: Nariametrics