FX.co ★ Nigeria Private Sector Activity Slips Back Into Contraction

In January 2026, the Stanbic IBTC Bank Nigeria Purchasing Managers' Index (PMI) decreased to 49.7 from December's 53.5. This dip below the crucial 50-point threshold indicates weaker overall business conditions after more than a year of expansion. Growth in new orders stagnated, ending a 14-month period of rising demand, which in turn restricted output to marginal gains at the year's outset. While purchasing activity and input stocks saw slower advances, particularly in the wholesale and retail sectors, agriculture, manufacturing, and services still reported moderate growth. Employment continued to grow for the eighth consecutive month, allowing firms to tackle backlog issues. On the pricing side, cost pressures increased, with purchase and staff costs both rising more rapidly, prompting businesses to raise their selling prices at the briskest rate in four months. However, inflation rates remained mild compared to the peaks observed after the pandemic. Despite these challenges, companies remained cautiously optimistic, anticipating a recovery in demand and activity in the coming months.