Stanbic IBTC Bank Purchasing Managers’ Index (PMI), in its October data, has revealed an improved growth momentum in the Nigerian private sector, with both output and new orders increasing at sharper rates than in September.

 

 

It showed that companies, taking on extra staff and expanding their purchasing activity, with the pace of input cost inflation remaining  subdued, relative to the picture over recent years, while output prices increased at the second-slowest pace for five-and a-half years.

 

 

Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration.

 

 

Speaking on the development, Head of Equity Research West Africa at Stanbic IBTC Bank, Muyiwa Oni, noted that business activity started the last quarter of 2025 on a strong note, with the headline PMI printing higher at 54.0 points, in October, compared to 53.4 points in September.

 

 

The development, he said, was on account of higher output and new orders growth.

 

 

“Notably, continued softening of price pressures and launch of new products by companies helped to drive higher new orders (56.3 points vs September: 55.4 points) and this in turn, supported output (57.7 points vs September: 56.1 points) growth to its highest level since April.

 

 

“Output increased across all the four sectors covered by the survey, led by manufacturing. Elsewhere, input costs increased in October but were still much weaker than levels seen in 2023 and 2024. However, the opposite was true for output prices, which rose at the second slowest pace in five-and-a-half years, just Headline inflation softened to 18.02% y/y in September, and we expect price moderation towards 15.84% – 16.22% y/y in October and 14.25% – 14.62% y/y in November,” he stated.

 

 

Oni predicted a further easing of  food prices, in the coming months, in line with the ongoing main harvest season, expected to ensure food prices remain at their seasonal low level until December, when gradual depletion of household stocks will commence.

 

 

Simultaneously, non-food inflation, he predicted, would be  pressured in October, amid higher fuel prices, relative to September, understandably due to supply constraints and production glitches at the Dangote refinery which contributes 30.0% – 40.0% of domestic petrol supplies.

 

 

Oni, however, expressed the optimism that the lingering local currency stability and appreciation would help provide some succour to non-food inflation in the near term.

 

 

“Lower inflation, stabilizing exchange rate, and anticipation of further rate cuts ahead should support improvement in real sector activity over the medium term. Accordingly, we see the Nigerian economy growing by 4.0% in 2025. Both Manufacturing and Services are likely to see higher growth in 2025 compared to 2024 levels, based on the results from the PMI surveys so far this year,” he added.

 

 

The headline PMI rose to 54.0 in October from 53.4 in September, signalling a solid monthly improvement in the health of the private sector and one that was more pronounced than in the previous survey period. Business conditions have now strengthened in 11 consecutive months.

 

 

A recent softening of inflationary pressures also reportedly helped to boost demand. Although companies continued to increase their selling prices at a marked pace in response to higher input costs, the latest rise in charges was the second-slowest for five-and-a half years, quicker only than that seen in August.