Market News

Nigeria’s private sector ended 2025 on a solid footing, as stronger customer demand supported continued growth in business activity and pushed the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index to 53.5 in December 2025.

This was disclosed in the latest PMI report released by the bank, which is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 private sector companies.

The PMI reading of 53.5 in December was broadly unchanged from November’s 53.6, signalling a sustained improvement in operating conditions for the 13th consecutive month. Stronger demand drove higher new orders, output, and purchasing activity, while employment rose only marginally and inflationary pressures edged up slightly but remained close to recent lows.

The report indicated that growth in December emanated from improved customer demand, which supported a marked monthly increase in new orders. The rise in sales was the 14th in as many months and only slightly weaker than in November.

The reported stated, “In turn, companies expanded output sharply, with the pace of growth broadly in line with that seen in November. All four broad categories saw output rise, led by agriculture. Stronger customer demand also encouraged firms to expand their purchasing activity and inventory holdings. Employment was also up, but only marginally and at the slowest pace since June 2025. For the second month running, companies noted a slight rise in backlogs of work. Delays in completing projects were reportedly caused by material shortages and power supply issues.

“The pace of inflation quickened but remained among the weakest in the past six years. Staff costs also increased at a faster pace as firms paid employees for additional work.

Companies responded to higher input costs by raising their selling prices in December. Here too, the pace of inflation quickened but was only slightly stronger than the recent low posted in November. Manufacturing registered the sharpest rise in charges among the four monitored categories.”

Business confidence in the private sector also improved in December, with close to 59 per cent of respondents predicting growth, supported by planned investments in the expansion of operations and the opening of new branches.

Commenting on the PMI, the Head of Equity Research, West Africa, at Stanbic IBTC Bank, Muyiwa Oni, said, “Headline PMI (53.5 vs. November: 53.6) moderated for the second consecutive month in December, although it remained in growth territory and broadly in line with the 2025 average. Continued expansion in business activity reflects higher customer demand, which supported a marked monthly increase in new orders. This encouraged companies to expand purchasing activity and inventory holdings. Meanwhile, business confidence improved markedly, hitting a six-month high, linked to planned investments in business expansion, including the opening of new branches and plans to boost product exports.

“While overall input prices increased sharply in December from the near five-year low recorded in November, the rate of inflation remained weaker than the 2025 average. Selling prices also increased, with the most significant rise seen in the manufacturing sector. The pickup in inflationary pressures may be linked to higher spending during the festive period. We estimate inflation at 1.44 per cent m/m, implying a CPI of 132.34 and y/y headline inflation of 32.34 per cent in December.”

On the broader economy, Oni projected growth at 3.8 per cent y/y in 2025 and 4.1 per cent y/y in 2026, noting that manufacturing and services were likely to record stronger growth compared with 2024. He added that government infrastructure spending, investment attraction efforts, and the forward-linkage impact of the Dangote refinery would further support growth.