Nigeria’s private sector sustains growth for ninth month

Nigeria’s private sector sustained its growth momentum in October, recording its ninth consecutive month of expansion, despite a slight moderation in business activities and rising production costs.

The Stanbic IBTC Bank Nigeria Purchasing Managers’ Index (PMI) stood at 55.7 points in October 2026, down from 56.4 points recorded in September.

Although the decline indicates a slower pace of expansion, the reading remained above the 50-point benchmark separating growth from contraction.

The latest figures suggest that businesses continued to benefit from improved customer demand and new product launches, even as rising fuel, transportation and raw material costs put pressure on operations.

Head of Equity Research, West Africa, at Stanbic IBTC Bank, Muyiwa Oni, said business conditions had remained in expansionary territory for nine consecutive months.

“Business conditions as measured by the headline PMI has remained in the expansionary territory for the ninth consecutive month, although it moderated to 55.7 points in October from 56.4 in September,” Oni stated.

According to the survey, companies recorded another significant increase in new orders during the month, although the pace of growth was slightly slower than September’s performance.

The September expansion in new orders was the fastest recorded since early 2022.

The increase in customer demand, alongside the introduction of new products, also supported a further rise in business activity.

Output increased across all four sectors monitored by the survey, extending the sector’s growth streak to 23 consecutive months.

Despite the increase in new orders, companies managed their workloads effectively, reducing outstanding business for the third consecutive month.

The survey showed that the pace of reduction in backlogs was the fastest since January.

However, the easing pressure on business capacity resulted in only a marginal increase in employment during October, the slowest pace of job creation in three months.

Nevertheless, companies have continued to record employment growth since June 2025.

On the cost of doing business, Oni said rising fuel and transportation expenses continued to push up production costs and selling prices.

“Panelists also indicated that prices of building materials and food produce increased during the month. Staff costs also increased modestly during the month, linked to the need to encourage employees to take on more work as well as help them deal with higher living costs,” he said.

The survey further revealed that purchase price inflation accelerated to a four-month high in October.

Consequently, companies increased their selling prices at the fastest pace in four months, although the rate remained below the peak recorded earlier in the year following the outbreak of war in the Middle East.

Despite the pressure from rising costs, Stanbic IBTC maintained its positive outlook for the Nigerian economy.

The bank projected that the economy would grow by 4.27 per cent year-on-year in 2026, compared with 4.16 per cent recorded in the first half of the year.

It also forecast economic growth of 4.65 per cent in 2027.

Oni attributed the projection to relative exchange rate stability, moderating consumer prices and the Federal Government’s investment drive in critical sectors.

He said these factors were expected to support business planning, investment and overall economic expansion.

Providing sectoral projections, the bank estimated that agriculture would grow by 4.50 per cent in 2026, compared with 2.92 per cent in 2025.

Manufacturing was projected to expand by 3.37 per cent, up from 1.41 per cent recorded in the previous year.

The services sector was also expected to grow by 4.47 per cent, compared with 4.14 per cent in 2025.

The projections indicate expectations of stronger economic activity across key sectors, although rising operating costs remain a major concern for businesses.