Nigeria’s business activity strengthened in September 2026 as the Central Bank of Nigeria’s composite Purchasing Managers’ Index rose to 53.0 points, reflecting continued expansion across major sectors of the economy.
The latest reading represented an improvement from 52.7 points recorded in August, with stronger industrial activity providing the main support.
The Purchasing Managers’ Index is an economic indicator used to assess business conditions across sectors.
A reading above 50 points generally indicates expansion compared with the previous month, while a figure below 50 signals contraction.
The September result therefore suggests that overall business conditions continued to improve, although the pace of growth varied across industries.
Industrial Sector Records Strongest Improvement
The industrial sector PMI increased to 52.0 points in September from 50.6 points in August.
The reading represented a six-month high.
The improvement was supported by stronger output and new orders, indicating increased business activity.
Electricity supply, water supply and wood products were among the subsectors that recorded stronger performance.
The rise in new orders is particularly important because it can provide an indication of demand for goods and services.
However, an increase in PMI does not directly measure the percentage growth in industrial production.
Rather, it reflects the direction and breadth of changes reported by surveyed businesses.
Services Remain in Expansion
The services sector PMI eased slightly to 53.2 points from 53.3 points in August.
Despite the marginal decline, the sector remained above the expansion threshold for the third consecutive month.
New orders improved during the period, suggesting continued demand for services.
However, employment and inventory indicators weakened.
The moderation was accompanied by softer readings in administrative and support services, real estate, and information and communication.
These developments were partly offset by improvements in trade, arts, entertainment and recreation, and educational services.
The mixed performance indicates that growth remained uneven across different parts of the services economy.
Agriculture Maintains Long Expansion
The agricultural PMI declined to 53.1 points in September from 53.4 points in August.
Despite the moderation, the sector remained above 50 points for the 26th consecutive month.
The weaker reading reflected softer general farming activity and employment indicators.
Agriculture remains an important component of Nigeria’s economy because of its contribution to food supply, employment and rural livelihoods.
Sustained expansion in the sector could support food availability, although actual outcomes depend on weather conditions, transportation, production costs and market access.
New Orders Support Economic Outlook
The improvement in new orders across parts of the economy provides some support for the near-term business outlook.
Rising demand can encourage firms to increase production and expand operations.
However, businesses may remain cautious about recruitment and investment where operating costs are high.
Inflation, energy expenses, transportation costs and access to finance can influence commercial decisions.
As a result, stronger business activity does not necessarily translate immediately into higher employment.
Operating Costs Remain a Challenge
The outlook for Nigerian businesses continues to be influenced by production and financing costs.
Companies may face pressure from electricity expenses, imported inputs and the cost of borrowing.
These factors can affect profit margins and limit the ability of businesses to expand.
For manufacturers, reliable infrastructure and access to working capital remain important considerations.
Service providers may also face challenges associated with consumer purchasing power and business confidence.
October Outlook Remains Positive
The supplied market assessment anticipates that the composite PMI will remain above 50 points in October.
The expectation is supported by stronger new orders and seasonal agricultural activity.
However, rising operating expenses could limit the pace of expansion.
For policymakers, the latest PMI figures provide an indication that economic activity is continuing to improve.
The challenge will be sustaining that momentum while addressing structural constraints affecting production, investment and employment.
