October information pointed to improved progress momentum within the Nigerian non-public sector, with each output and new orders growing at sharper charges than in September. In flip, corporations took on further workers and expanded their buying exercise. The tempo of enter value inflation remained subdued relative to the image over current years, whereas output costs elevated on the second-slowest tempo for five-and a-half years. The headline determine derived from the survey is the Stanbic IBTC Purchasing Managers’ Index™ (PMI®). Readings above 50.0 sign an enchancment in enterprise circumstances on the earlier month, whereas readings beneath 50.0 present a deterioration.
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank commented: “Business exercise began the final quarter of 2025 on a robust observe, with the headline PMI printing increased at 54.0 factors in October in comparison with 53.4 factors in September. This was on account of upper output and new orders progress. Notably, continued softening of worth pressures and launch of recent merchandise by corporations helped to drive increased new orders (56.3 factors vs September: 55.4 factors) and this in flip, supported output (57.7 factors vs September: 56.1 factors) progress to its highest stage since April. Output elevated throughout all of the 4 sectors lined by the survey, led by manufacturing. Elsewhere, enter prices elevated in October however had been nonetheless a lot weaker than ranges seen in 2023 and 2024. However, the other was true for output costs, which rose on the second slowest tempo in five-and-a-half years, simply Headline inflation softened to 18.02% y/y in September, and we count on worth moderation in the direction of 15.84% – 16.22% y/y in October and 14.25% – 14.62% y/y in November.
This is as a result of we see meals costs moderating additional within the coming months in step with the continued principal harvest season which is predicted to make sure meals costs stay at their seasonal low stage till December, when gradual depletion of family shares will begin. Simultaneously, non-food inflation must be pressured in October amid increased gas costs relative to September, understandably attributable to provide constraints and manufacturing glitches on the Dangote refinery which contributes 30.0% – 40.0% of home petrol provides. Nonetheless, the lingering native forex stability and appreciation ought to assist present some succour to non-food inflation within the close to time period. Lower inflation, stabilizing change fee, and anticipation of additional fee cuts forward ought to assist enchancment in actual sector exercise over the medium time period. Accordingly, we see the Nigerian financial system rising by 4.0% in 2025. Both Manufacturing and Services are more likely to see increased progress in 2025 in comparison with 2024 ranges, primarily based on the outcomes from the PMI surveys thus far this 12 months.”
The headline PMI rose to 54.0 in October from 53.4 in September, signalling a stable month-to-month enchancment within the well being of the non-public sector and one which was extra pronounced than within the earlier survey interval. Business circumstances have now strengthened in 11 consecutive months. Output progress hit a six-month excessive in October, with panellists highlighting the constructive influence of rising new orders and the introduction of recent merchandise. Business exercise elevated throughout all 4 broad sectors, with progress quickest in manufacturing. The launch of recent merchandise additionally helped to drive up buyer numbers in October, thereby feeding via to rising new orders.
A current softening of inflationary pressures additionally reportedly helped to spice up demand. Although corporations continued to extend their promoting costs at a marked tempo in response to increased enter prices, the most recent rise in fees was the second-slowest for five-and-a half years, faster solely than that seen in August. The fee of enter value inflation ticked increased, nevertheless, amid quicker will increase in each buy costs and workers prices. That stated, the rise in enter costs was nonetheless muted in comparison with these seen in 2023 and 2024. Rising new orders inspired corporations to tackle further workers in October, the fifth month working by which this has been the case. The fee of job creation was solely modest, nevertheless, and softer than seen in September.
Higher employment helped corporations to maintain on prime of workloads, however energy outages and cost delays from shoppers led to build-ups in backlogs elsewhere. On steadiness, excellent enterprise was broadly unchanged in October. Both buying exercise and shares of inputs elevated as corporations responded to increased new orders and the prospect of additional expansions within the months forward. Meanwhile, suppliers’ supply instances continued to shorten. Although methods round advertising and exporting supported confidence within the year-ahead outlook for enterprise exercise, sentiment dropped for the fourth month working in October and was the bottom since May. Around 46% of respondents predicted an increase in output over the following 12 months.
