By Favour Pius
Nigeria’s private sector returned to growth in February, with the Purchasing Managers’ Index (PMI) rising sharply to 53.2, signaling renewed expansion in business activity after slipping into contraction at the start of the year.
The latest report, released by Stanbic IBTC Bank and compiled by S&P Global showed a recovery from January’s 49.7 reading, pushing the index firmly above the 50.0 threshold that separates expansion from contraction. The report is endorsed by the National Bureau of Statistics (NBS).
Analysts said the rebound reflects strengthening customer demand, improved product affordability and renewed order inflows, helping firms regain momentum after a brief slowdown.
New orders expanded at a solid pace, while output growth accelerated to a four-month high, supported by increased customer footfall and product diversification across key sectors. Wholesale and retail activity, which had contracted in January, returned to expansion alongside gains in agriculture, manufacturing and services.
Employment levels rose for the ninth consecutive month, with job creation hitting its fastest pace since October 2025 as firms scaled up operations to meet higher demand.
However, backlogs of work also increased at the quickest rate since May 2020, driven by delayed client payments, material shortages and persistent power supply constraints.
Purchasing activity and inventory holdings gre markedly as companies responded to higher workloads. Suppliers’ delivery times improved, aimed by quicker payments and smoother logistics.
Cost pressures eased significantly during the month, offering some relief to businesses. Purchase cost inflation slowed to its weakest level in over six years, supported partly by naira appreciation and improved foreign exchange liquidity. Output price inflation also moderated to its lowest level since early 2020, although some firms continued to report higher costs for raw materials and animal feed.
The relative stability of the naira which has traded below N1,400 per dollar in recent weeks contributed to softer imported inflation, underpinned by stronger external balances, improved remittance inflows and foreign exchange interventions by the Central Bank of Nigeria.
Commenting on the data, Head of Equity Research West Africa at Stanbic ABTC, Muyiwa Oni,said the February figures suggest business conditions are regaining traction, with stronger demand supporting output growth and price stability.
Looking ahead, firms expressed cautious optimism about the next 12 months, citing expansion plans, advertising campaigns and infrastructure-linked opportunities as key growth drivers.
Stanbic IBTC projects Nigeria’s real GDP to expand by 3.86 per cent year in the first quarter of 2026 and 4.1 per cent for the full year, supported by infrastructure spending, investment in oil and gas, livestock development initiatives and manufacturing growth, including forward linkages from the Dangote refinery.
The survey was conducted between February 10 and 25, 2026,covering about 400 firms across agriculture, mining, manufacturing, construction, wholesale, retail and services.
