The Nigerian non-public sector returned to progress in February, following a muted begin to 2026. A renewed rise in new orders fed by way of to an accelerated improve in enterprise exercise. Employment, enter shopping for and inventories have been additionally up halfway by way of the opening quarter of the yr. Meanwhile, an enchancment within the energy of the foreign money helped result in an easing of inflationary pressures, with each buy prices and output costs rising on the slowest charges in simply over six years. The headline determine derived from the survey is the Stanbic IBTC Purchasing Managers’ Index™ (PMI®).
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank commented: “After the dip seen in January, Nigerian non-public sector returned to progress, with the headline PMI settling increased at 53.2 factors in February from 49.7 in January. This was consistent with increased buyer demand, which drove increased new product choices at aggressive pricing. Accordingly, output (55.8 vs January: 50.2) regained momentum in February whereas new orders (55.5 vs January: 49.9) additionally elevated markedly within the month. Notably, the wholesale & retail sector, which had dipped in January, returned to progress, thereby making certain that each one the 4 monitored sectors by the survey elevated in February. Elsewhere, native foreign money appreciation helped to help softer enter and output costs in February, because the naira has been buying and selling beneath 1400 in opposition to the USD constantly since 29 January.
Strengthening exterior account, increased offshore FX flows, and enchancment in remittances proceed to help increased FX provides with the CBN additionally stepping in by shopping for USD within the FX market to reasonable the tempo of native foreign money appreciation. The Nigerian economic system is on monitor to develop by 3.86% y/y in Q1:26 and we nonetheless see actual GDP progress at 4.1% y/y in 2026. The authorities has been seen in infrastructure, livestock improvement, easing commerce constraints, and attracting investments in oil & gasoline and manufacturing. Aside from that, the Dangote refinery is predicted to proceed to have forward-linkage influence on different sectors of the economic system.
Additionally, seemingly decrease rates of interest consistent with decrease inflation and change price stabilization ought to help non-public consumption and enterprise investments in 2026. Because of those elements, we see extra sectors contributing to actual GDP progress price in 2026 in comparison with 2025, seemingly translating to an enchancment within the high quality of lives of the residents in comparison with the final two years when the residents witnessed the total detrimental influence of the federal government’s flagship reforms.”
Readings above 50.0 sign an enchancment in enterprise circumstances on the earlier month, whereas readings beneath 50.0 present a deterioration. After dipping beneath the 50.0 no change mark in January, the headline PMI recovered from the studying of 49.7 to 53.2 in February. As such, the most recent information pointed to a strong month-to-month enchancment within the well being of the non-public sector. Except for January’s blip, enterprise circumstances have improved constantly since December 2024. New orders returned to progress in February, with anecdotal proof pointing to enhancing buyer demand and higher product affordability.
The rise in new enterprise, increased buyer numbers and new product choices helped result in a rejuvenation in progress of output, which elevated markedly and on the quickest tempo in 4 months. All 4 monitored sectors noticed exercise rise as wholesale & retail posted a renewed enlargement. Higher new orders led companies to broaden their staffing ranges once more, and on the quickest tempo since final October. Employment has now elevated in 9 consecutive months.
Despite sustained job creation, nonetheless, backlogs of labor elevated on the quickest tempo since May 2020. Panellists linked rising excellent enterprise to delayed consumer funds, shortages of employees and supplies, and energy provide points. A need to maintain up with order necessities meant that firms expanded their buying exercise and stock holdings markedly in February. Suppliers’ supply instances continued to shorten, nonetheless, amid immediate funds and improved site visitors circumstances. A stronger foreign money led to a marked easing within the tempo of buy value inflation in February.
The newest rise in buy costs was the weakest in simply over six years. Where inflation was recorded, panellists linked this to increased costs for animal feed and uncooked supplies. Meanwhile, cost-of-living funds to employees meant that employees prices continued to rise. With the speed of buy value inflation softening, companies additionally raised their output costs at a a lot weaker tempo. Here too, the speed of inflation was the weakest since January 2020. Advertising efforts and enterprise enlargement plans have been central to optimistic expectations for output over the subsequent 12 months. Sentiment picked up in February, however remained comparatively muted.
