Business Activity Rises To 52.4 In April Amid Higher Fuel Costs

Business activity in Nigeria rose through April as demand conditions improved, though higher fuel costs continued to pressure operating expenses and margins.
According to Stanbic IBTC Purchasing Managers’ Index (PMI) report, the headline PMI ticked up to 52.4 in April from 51.9 in March, above the 50.0 no-change mark for the third month running and signalling a solid strengthening in the health of the privatesector.The rate of improvement was slightly greater than that seen in the previous survey period.
The report stated that the private sector remained in growth territory at the start of the second quarter (Q2) of the year as customer numbers and market demand continued to strengthen.
It noted that the impacts of higher fuel costs as a result of the war in the Middle East were felt again, pushing up prices and reportedly limiting expansions in new orders and business activity.
The report further said that “improving demand conditions meant that new orders continued to rise,albeit with the rate of growth softening amid inflationary pressures.
“Business activity also increased, and at a solid pace that was slightly faster than that seen in March.”
The report however said, companies mentioned that rising prices had limited the pace of growth.
The head of Equity Research West Africa at Stanbic IBTC Bank, Muyiwa Oni said, “the health of Nigeria’s private sector improved in April, remaining above the 50-points growth threshold for the third consecutive month, as new orders increased in line with higher customer numbers and rising demand even as price pressures remain prevalent.
He noted that “despite the improvement in new orders, we understand that lingering inflationary pressures limited the pace of expansion.
“Notably, companies increased their selling prices in April to the highest level since December 2024 in response to rising fuel and raw material costs.
“Staff costs also increased modestly as some companies increased their staff pay so as to help them with increasing transportation fares. Business expectations also improved in April compared to March as businesses plan to expand their operations through the opening of new branches, stock building and entry into new markets.”
“The improved start of the second quarter of the year by Nigerian businesses continue to support our view of improved growth expectations in 2026 relative to 2025.”
Oni added that “we still maintain our expectation that the Nigerian economy is likely to grow by 4.22 per cent year-on-year in 2026, from 3.87 per cent Y-o-Y in 2025.
“We estimate the non oil sector’s grow that 4.24 per cent Y-o-Y in 2026, from 3.71 per cent Y-o-Y in 2025, likely driven primarily by services, which we see growing by 5.64 per cent Y-o-Y in 2026.”
He pointed out that the government’s continuous investment attraction across oil & gas, solid minerals, electricity, agriculture and general manufacturing should continue to support sentiment on production activity.