Nigeria’s private sector has recorded improved growth momentum, driven by a relatively stable exchange rate and a moderation in petroleum product prices. These factors have contributed to easing inflationary pressures, pushing the Purchasing Managers’ Index (PMI) to 53.7 in February 2025, up from 52.0 in January.
The latest Stanbic IBTC PMI report, released yesterday, revealed that the Nigerian private sector experienced its third consecutive month of growth, with the February PMI reaching its highest level since January 2024, when it stood at 54.5 points. The PMI, a key indicator of economic health, signals an improvement in business conditions when readings are above 50.0 and a deterioration when below that threshold.
According to the report, the growth was fueled by increased output, new orders, and purchasing activity, as demand strengthened and inflationary pressures showed signs of easing. Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, commented on the findings, stating, “Activity in Nigeria’s private sector improved for the third consecutive month, with the latest PMI reading of 53.7 points in February at its highest level since January 2024.”
Oni attributed the positive trend to the stabilizing exchange rate and declining fuel prices, which have supported a reduction in inflationary pressures. This, in turn, has boosted consumer demand, leading to a rise in new orders for the fourth consecutive month. Survey participants noted that customers were more willing to commit to new projects, reflecting growing confidence in the economic environment.
The report also highlighted a sharp increase in output, with the output index rising to 56.9 points in February from 53.7 points in January. However, while input price inflation eased to its lowest level since April 2024, approximately 39% of respondents reported increasing their output prices, with less than 1% lowering their charges.
The February PMI data underscores the resilience of Nigeria’s private sector amid ongoing economic challenges. The moderation in fuel prices and exchange rate stability have provided much-needed relief, enabling businesses to expand operations and meet rising consumer demand.
As inflationary pressures continue to ease, stakeholders remain optimistic about the potential for sustained growth in the private sector. However, the report also highlights the need for continued efforts to stabilize the economy and address underlying structural issues to ensure long-term economic recovery and development.
The Stanbic IBTC PMI report serves as a critical barometer for policymakers and investors, offering insights into the health of Nigeria’s private sector and guiding decisions aimed at fostering economic stability and growth.
