Stanbic IBTC Bank Nigeria PMI®: New Orders Broadly Stable at Start of 2026
By The People’s Voice Nigeria News
Nigerian companies began 2026 on a muted note, with new orders stagnating and output growth slowing. The latest Stanbic IBTC Purchasing Managers’ Index™ (PMI®) fell to 49.7 in January, down from 53.5 in December, slipping below the 50.0 no-change threshold. Readings above 50 indicate expansion, while those below signal contraction. Despite the dip, the headline figure suggests broadly stable business conditions at the start of the year.
Muyiwa Oni, Head of Equity Research West Africa at Stanbic IBTC Bank, noted:
“After 13 months of consecutive readings above 50, Nigeria’s private sector activity dipped in January, reflecting the usual weak demand at the start of the year following festive spending in December. Historical data shows January PMI typically trails December, except in 2024. The slowdown was most pronounced in wholesale & retail, while agriculture, services, and manufacturing maintained growth above 50 points.”
Oni added:
“This is the first time in the survey’s history (since 2014) that a January PMI has fallen below 50, signaling potential structural pressures beyond seasonal slowdowns. Output prices rose sharply to a four-month high amid higher purchase costs, while staff costs increased at their fastest pace since July 2025.”
Sector Highlights
- Wholesale & Retail: Weak demand pushed the sector below the 50-point growth threshold, driving the overall PMI contraction.
- Agriculture, Manufacturing & Services: All three sectors reported growth above 50, offsetting some of the slowdown in wholesale & retail.
- Employment: Job creation continued at a modest but steady pace, marking eight consecutive months of rising staffing levels.
The combination of rising employment and broadly stable new orders enabled companies to reduce work backlogs for the first time in three months, and to the largest degree since March 2025.
Costs and Inflation
- Purchase prices: Increased sharply amid higher raw material costs, pushing inflation to a three-month high.
- Staff costs: Rose at the fastest rate since July 2025 as companies adjusted wages to support employees’ living costs.
- Output prices: Companies passed higher purchase costs to customers, resulting in the strongest output price inflation in four months.
Despite these increases, inflation remained moderate relative to historical levels since the COVID-19 pandemic.
Business Sentiment
Overall business confidence dipped slightly, but companies remained optimistic about growth in the coming year. Positive sentiment was tied to:
- Planned expansions
- Higher stock holdings
- Anticipated increases in new orders
Oni concluded:
“We expect Nigerian GDP growth of 4.1% y/y in 2026, supported by government infrastructure investments, livestock development, trade facilitation, and forward-linkages from the Dangote refinery. Lower interest rates and exchange rate stabilization are also likely to boost private consumption and business investment, with broader sectoral contributions to growth compared to 2025.”
The report underscores that while 2026 began with a muted business environment, underlying resilience in agriculture, manufacturing, and services, combined with supportive government policies, points to a positive trajectory for the Nigerian private sector in the months ahead.
