By SCM Staff Writer
LAGOS, Nigeria – The Nigerian private sector concluded November with another month of solid expansion in business conditions, underpinned by easing inflationary pressures and a jump in customer demand fuelled by new product introductions.
The headline Stanbic IBTC Purchasing Managers’ Index™ (PMI®), which gauges the health of the private sector, registered at 53.6 in November. While this reading moderated slightly from October’s 54.0, it remains comfortably above the 50.0 no-change mark, marking the thirteenth consecutive month of improving business conditions.
Inflationary Trends Soften Significantly
A key driver of the sustained growth was the continued sharp deceleration in inflation. Input costs for businesses increased at the slowest pace in almost five years, since December 2020.
This was due to weaker rises in both purchase prices and staff costs. Mirroring this trend, the rate of output price inflation also eased for the sixth time in seven months, reaching its lowest point since April 2020.
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, commented on the development: “The strong output continues to reflect easing inflationary pressures which is helping to support higher sales for businesses who are now launching new products and securing more customers.”
New Orders Hit Three-Month High
Buoyed by the new product launches and the less intense cost environment, new orders rose sharply, reaching a three-month high of 56.9 points, up from 56.3 points in October. This marked the thirteenth consecutive month of new order expansion.
Consequently, business activity (output) grew across all four sectors covered by the survey—Agriculture, Manufacturing, Wholesale & retail, and Services—with Manufacturing and Services leading the charge. Companies attributed the growth to higher sales and the successful securing of more customers.
In response to the surge in new orders, companies scaled up their operational capacity.
The rate of expansion in purchasing activity hit a seven-month high. This sharp increase in input buying led to a rise in inventories at the fastest pace since June 2023, as companies prepared for future customer requirements.
However, while firms increased staffing levels, the pace of employment growth slowed to only a marginal extent. Despite this, backlogs of work increased for the first time in four months, which panellists linked to delayed customer payments. Conversely, suppliers’ delivery times continued to improve for the fifth month in a row.
Despite the solid operational performance, business confidence eased for the fifth consecutive month to its lowest point since May. Optimistic respondents, however, linked their positive outlook to planned business investment and expansion.
Looking ahead, Mr. Oni maintained an optimistic view on the broader economy. “We still see the Nigerian economy growing by 4.0% in 2025,” he stated, projecting higher growth for both Manufacturing and Services compared to 2024.
He also noted that anticipated factors, including the forward-linkage impact of the Dangote refinery, likely lower interest rates due to falling inflation, and greater exchange rate stability, should support private consumption and business investments in 2026, leading to a projected “improvement in the quality of lives of the citizens relative to 2025.”
