Abiodun JIMOH
Nigeria’s private sector kicked off the third quarter of 2025 on a strong footing, with the Stanbic IBTC Purchasing Managers’ Index™ (PMI®) climbing to a three-month high of 54.0 in July, up from 51.6 in June. The reading signals a solid and accelerated improvement in business conditions, marking the eighth consecutive month of expansion.
The uptick was driven by sharp increases in output and new orders, both growing at their fastest rates in three months. Businesses cited improving customer demand, softening inflation, and the introduction of new products as key contributors to the surge in activity.
A standout feature of the latest report was the steep rise in employment—the highest since October 2023—as firms expanded their workforce to meet rising demand and quicken project delivery. With increased staffing levels, companies were able to maintain a stable level of outstanding work after three months of backlog accumulation.
Purchasing activity surged in response to higher orders, leading to inventory buildup, while suppliers’ delivery times improved. Despite continued upward pressure on input prices—mainly due to currency depreciation and high raw material costs—purchase cost inflation eased to its lowest since April 2020.
Conversely, staff costs rose at the fastest pace in five months, driven by both hiring and firms’ efforts to support employees facing rising transportation costs. However, overall output prices increased at the slowest pace since May 2023, with some firms offering discounts to attract new business.
Looking ahead, business sentiment remains positive, though slightly down from June’s near three-year high. Firms optimistic about future output linked their expectations to planned capital expansion and increased advertising.
