Private sector ends 2025 strong as PMI hits 53.5
Stronger consumer demand sustained business activity growth and raised the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index to 53.5 in December 2025, marking a good end to 2025 for Nigeria's private sector.This was revealed in the bank's most recent PMI report, which was put together by S&P Global. The index is derived from purchasing managers' survey answers from a panel of roughly 400 businesses in the private sector.
Compared to November's 53.6, the December PMI index was essentially unchanged, indicating an improvement in operating conditions for the thirteenth consecutive month. While employment creation remained modest, rising demand drove growth in new orders, output, and purchasing activities. Additionally, inflationary pressures increased little but remained near recent lows.
According to the report, a significant month-over-month increase in new orders was supported by December's growth, which was fueled by increased consumer demand. The growth in sales was just slightly slower than in November and was the 14th consecutive monthly increase.
"In turn, companies expanded output sharply, with the pace of growth broadly in line with that seen in November," the study said. Production increased in all four major sectors, with agriculture leading the way. Increased consumer demand also prompted businesses to increase their inventory holdings and purchase activity. Additionally, employment increased, but only slightly and at the slowest rate since June 2025. Companies reported a minor increase in work backlogs for the second consecutive month.
"In turn, companies expanded output sharply, with the pace of growth broadly in line with that seen in November," the study said. Production increased in all four major sectors, with agriculture leading the way. Increased consumer demand also prompted businesses to increase their inventory holdings and purchase activity. Additionally, employment increased, but only slightly and at the slowest rate since June 2025. Companies reported a minor increase in work backlogs for the second consecutive month.
In December, businesses increased their selling prices in response to increased input expenses. Although the rate of inflation increased here as well, it was only marginally higher than the most recent low recorded in November. Of the four areas under observation, manufacturing saw the largest increase in charges.
December saw a rise in business confidence in Nigeria's private sector, with over 59% of respondents expecting growth due to planned investments in branch opening and operational expansion.
December saw a rise in business confidence in Nigeria's private sector, with over 59% of respondents expecting growth due to planned investments in branch opening and operational expansion.
"Headline PMI (53.5 vs. November: 53.6) moderated for the second consecutive month in December, although it remained in growth territory and broadly in line with the 2025 average," stated Muyiwa Oni, Head of Equity Research, West Africa at Stanbic IBTC Bank. A significant monthly increase in new orders was backed by the ongoing growth in business activity, which is indicative of increased client demand. This prompted businesses to increase their inventory holdings and purchase activity. As a result of anticipated investments in business expansion, such as the creation of new branches and plans to increase product exports, business confidence significantly improved and reached a six-month high.
"The rate of inflation remained lower than the 2025 average, even though overall input prices rose significantly in December from the nearly five-year low reported in November. Additionally, selling prices rose, with the industrial sector experiencing the biggest gain. Higher spending during the holiday season may be connected to the increase in inflationary pressures. Our estimate of inflation is 1.44 percent m/m, which suggests a CPI of 132.34 and headline inflation of 32.34 percent year over year in December.
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