Nigeria’s economic recovery holds as PMI points to steady growth

Nigeria’s economic recovery remained on track in March, with private sector activity expanding for the sixteenth consecutive month, even as the pace of growth showed signs of moderation.

The composite Purchasing Managers’ Index (PMI) stood at 53.2 points in March 2026, staying above the 50-point threshold that separates expansion from contraction, according to the latest survey conducted between March 9 and 13 by the Central Bank of Nigeria (CBN).

The reading reflects sustained growth across the economy, with 31 of 36 subsectors reporting increased activity.

The data point to continued resilience in business conditions, driven by broad-based expansion across industry, services and agriculture, reinforcing a steady growth outlook for the first quarter.

Industrial activity remained the strongest driver, with the sector’s PMI at 54.0 points. Fourteen of 17 subsectors recorded expansion, supported by increases in output, new orders and employment, highlighting improved production levels and rising demand.

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The services sector extended its growth streak to fourteen months, posting a PMI of 52.0 points.

Twelve of 14 subsectors recorded expansion, though the pace slowed compared to the previous month, suggesting softer demand in parts of the sector. Education services recorded the strongest gains, while professional services and accommodation posted declines.

Agriculture maintained a consistent upward trajectory, with a PMI reading of 52.8 points, marking its twentieth consecutive month of expansion. All five subsectors surveyed recorded growth, led by strong performance in forestry and general farming activities.

Key components of demand remained positive. Output rose to 53.7 points, while new orders and employment both stood at 52.2 points, signaling continued increases in production and hiring.

Inventories of raw materials also expanded, reflecting expectations of sustained demand.

Supply chain conditions improved, with the suppliers’ delivery time index at 56.3 points, indicating faster delivery performance and greater operational efficiency.

Despite the overall positive outlook, the report highlighted mounting cost pressures, as input prices rose faster than output prices across all sectors, suggesting potential margin compression for businesses.

While five subsectors, including primary metals, recorded contractions, their impact was limited and insufficient to offset the broader expansion recorded across the economy.

Overall, the data suggest Nigeria’s recovery remains intact, supported by widespread growth across sectors, although the moderation in momentum and rising costs signal emerging challenges that could shape the pace of expansion in the coming months.