The Purchasing Managers’ Index (PMI) report of the Stanbic IBTC Bank has showed that manufacturing was the only sector that failed to experience increased output in August 2025.
The PMI reported that growth in the Nigerian private sector continued to gain momentum during August as customer demand improved and inflationary pressures softened.
It also stated that sharper increases in output and new orders were recorded, although rates of expansion in purchasing activity and employment eased.
It said: “At 54.2 in August, the headline PMI was above the 50.0 no-change mark for the ninth month running, signalling a sustained improvement in the health of the Nigerian private sector. Moreover, the latest reading was up from 54.0 in July, pointing to a solid strengthening of business conditions and one that was the most pronounced since April.
“The rise in the headline index primarily reflected sharper expansions in output and new orders, with rates of growth hitting four- and 19-month highs respectively. Output increased across three of the four broad sectors covered by the survey, the exception being manufacturing.”
The report also stated that “inflationary pressures waned midway through the third quarter. The pace of increase in purchase prices slowed for the fourth consecutive month and was the weakest since March 2020.”
Commenting on the report, the Head of Equity Research West Africa at Stanbic IBTC Bank,
Mr. Muyiwa Oni, said that the increase in business activity was driven by sharper increases in output and new orders.
Oni said: “Notably, output (56.8 points vs July: 56.1 points) increased in line with customers’ willingness to commit to new projects, while the growth in new orders (58.3 points vs July: 57.3 points) quickened to a 19-month high amid reports of increasing customer demand.
“Given these higher new orders, firms expanded their staffing levels for the third consecutive month. The opening of new branches and marketing plans are also supporting firms’ optimism that output will increase over the coming year.
“Elsewhere, input cost eased to its lowest level since March 2023 even as the latest increase is still above the series average. In line with this, the rate of increase in output prices moderated for the fourth consecutive month in August and the slowest since April 2020.”
He said that the continued moderation of input and output prices still suggests that inflation is likely to remain soft in the near term, and may incentivise the Monetary Policy Committee and the Central Bank of Nigeria to switch to an accommodative monetary policy by September from the current neutral stance.
“Indeed, we estimate headline inflation to moderate further in August to 21.45 per cent y/y – 21.63 per cent y/y, and possibly settle at 17.19 per cent y/y – 17.92 per cent y/y by November. Accordingly, we still expect up to 150 bps cumulative rate cut in 2025,” he added