Nigeria’s Private-Sector Growth Hits Four-and-a-Half-Year High in September, Stanbic IBTC Report Shows
Nigeria’s private sector recorded its strongest expansion in business activity since February 2022, as rising new orders boosted output in September, according to the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index (PMI®).
The headline PMI rose for a second consecutive month, reaching 56.4 in September from 54.3 in August. Readings above 50 indicate improving business conditions, while those below 50 signal deterioration.
Growth in new business accelerated to its fastest pace since February 2022, supported by stronger customer demand and the launch of new products. Business activity also expanded at its quickest rate since that month. Output increased across all four sectors covered by the survey.
Companies responded to higher workloads by increasing purchasing and building inventories. The accumulation of stocks was the strongest since the end of 2021. Supplier performance improved for a third month, with respondents citing prompt payments and timely deliveries.
Employment rose modestly. Some firms took on temporary workers to complete specific projects, helping them manage workloads as new orders increased. Backlogs of work fell for a second month, though only slightly.
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, said: “Overall business conditions improved significantly in September, with the headline PMI (56.4 points vs August: 54.3 points) rising to a level not seen since February 2022 (57.3 points), thereby ensuring a better third quarter for business activities relative to the second quarter of the year. Indeed, all the four sectors monitored by the survey recorded significant improvement in September, as firms noted improving customer demands as ensuring they secure new orders during the period while also introducing new products into the market. Based on this, companies also increased the pace of hiring although the bulk of these workers were hired on a temporary basis to complete specific tasks.
Elsewhere, higher fuel prices continue to feed into an increase in transport costs. This, in addition to increase in raw material prices, rising staff costs, as well as the prices of other food products helped to ensure that input costs maintained their uptrend. This then fed into output prices increasing to a three-month high in September.
The strong end to the quarter implies that the PMI prints in Q3:26 are consistent with a likely 4.56% y/y GDP growth in Q3:26, taking the full year 2026 growth estimate to approximately 4.4% y/y from 3.87% y/y recorded in 2025. The non-oil sector is expected to perform better in 2026 compared to 2025 as more sectors contribute to improvement in GDP growth rate this year. Among the three broad sectors of the economy, we expect the manufacturing sector to see the biggest boost to its growth amid the low statistical base effects from 2025 while ICT, trade, real estate, and finance & insurance will likely remain the biggest drivers of the services sector’s growth.”
Input-cost inflation remained elevated, reaching a three-month high. Respondents pointed to higher fuel and transport costs, as well as increases in the prices of animal feed, food and other raw materials. Staff costs also rose as some companies offered incentives and helped employees manage higher living costs.
Businesses passed some of these costs on to customers. Selling prices increased at their fastest rate since June, in line with the rise in input and staff costs.
Companies were more optimistic about the 12-month outlook in September. Survey respondents cited expansion plans, including opening new branches and starting exports, alongside efforts to secure new customers and build stock.
