Market News

Nigerian businesses have expressed optimism of a better economy in 2016, boosted by expectations of naira appreciation, stronger business activity, improved operating conditions and continued expansion plans.

According to the Central Bank of Nigeria’s December 2025 Business Expectations Survey (BES) report, corporate leaders across the Industry, Agriculture and Services sectors said they expect the naira to strengthen against the US dollar across short, medium and longer-term review periods.

The improved optimism is coming against a backdrop of macroeconomic reforms and relative stability towards the end of 2025, marking a growing confidence in currency stability, which businesses believe will support planning, investment and operational predictability in 2026.

The aggregate Business Confidence Index (BCI) remained solidly in positive territory in the closing months of 2025, indicating that firms expect improved economic conditions in the months ahead. In the November 2025 BES, confidence stood at 37.5 index points, with projections rising to as much as 52.8 points within six months, indicating robust optimism stretching into mid-2026.

Across sectors, industry firms led the optimism, followed by agriculture and services. Businesses reported increasingly positive expectations for volume of business activity, total orders, financial conditions and access to credit, suggesting that firms anticipate higher sales, expanded output and improved cash flows in 2026.

Respondent firms indicated that the exchange rate index, which tracks confidence in the naira-to-dollar value, will trend upwards across short- and medium-term horizons. Businesses also projected a positive outlook for borrowing rates, anticipating easing credit costs and a better lending environment as inflationary pressures moderate and monetary conditions improve.

Business leaders responding to the survey, also signalled ambitious expansion and hiring plans. In the survey, firms expressed stronger prospects for expanding operations and recruiting staff, particularly in sectors like construction and mining and quarrying, sectors that reported notable expansion and employment expectations for late 2025.

Despite the optimistic outlook, firms continued to flag structural and operational challenges that could temper growth prospects. The survey identified insecurity, high and multiple taxation, insufficient power supply, elevated interest rates, and financial instability as among the leading constraints hampering business performance.