Mixed Purchasing Managers Indexes Signal Divergent Views on Economic Activity

BY OLUSHOLA BELLO, AND BUKOLA ARO-LAMBO Lagos

Days after the Central Bank of Nigeria (CBN) released its Purchasing Managers Index (PMI) survey showing a contraction in economic activity due to the escalating war in the Middle East, Stanbic IBTC has released its own PMI, reporting an expansion in business activity.

Survey for the composite Purchasing Managers’ Index (PMI) released by the CBN, which was conducted from April 6-10, 2026, to gauge the direction of economic activities in Nigeria for the month, settled at 49.4 points, falling below the 50-point threshold for the first time in 16 months

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 private sector. The rate of improvement was slightly greater than that seen in the previous survey period.

A sectoral breakdown of the CBN PMI indicated that the downturn was largely driven by weaknesses in the industry and services segments. The Industry PMI stood at 49.5 points, reflecting a marginal contraction as eight of the 17 subsectors recorded declines. Although production posted a slight expansion at 50.2 points, weakening new orders and employment, at 49.5 and 48.7 points respectively, weighed on overall performance. Raw materials inventory also contracted sharply to 46.8 points.

The Stanbic IBTC 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 resulting from the war in the Middle East were felt again, pushing up prices and reportedly limiting 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 that 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-point 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 continues 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 growth to be 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 ongoing investment attraction across oil & gas, solid minerals, electricity, agriculture, and general manufacturing should continue to support sentiment for production activity.