Nigerian Private Sector Sees Strong Growth as PMI Hits 54.3 in March
The Nigerian private sector experienced significant growth in March, as indicated by the latest data from the Stanbic IBTC Bank Purchasing Managers’ Index™ (PMI®). The PMI rose to 54.3, up from 53.7 in February, marking the fourth consecutive month of improvement and the highest level since January 2024. A reading above 50.0 indicates better business conditions, while anything below signals a downturn.
This month’s PMI reflects an acceleration in output, new orders, and employment, driven by easing inflationary pressures. Input costs rose at the slowest rate since May 2023, which has positively impacted domestic demand. The surge in new orders was particularly notable, reaching its fastest pace in 14 months.
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, noted, “The softening inflation is enhancing domestic demand, contributing to the overall improvement in private sector activity in Nigeria. The rise in customer requests has led to a notable increase in new orders in March.”
Additionally, employment levels rose for the fourth month in a row, although some companies reported hiring on a contract basis. Input costs, while still rising, moderated sharply, and the inflation rate for output prices eased for the third consecutive month.
Looking ahead, the outlook for the non-oil sector remains positive, with projected growth of 3.9% year-on-year in the first quarter of 2025 and an anticipated increase in overall economic growth to 3.5% for the year. Factors such as improved foreign exchange stability and lower borrowing costs are expected to further bolster the sector.
Output increased across all sectors surveyed, leading to a modest rise in employment—the strongest seen in seven months. Companies are also ramping up their purchasing activities to build inventories in line with current and future business needs. Although optimism about future business activity dipped to a three-month low, some firms remain hopeful, citing planned advertising and new investments as reasons for anticipated growth.