Nigeria’s Economy at a crossroads: Private sector confidence surges for 9th straight month

…But ban momentum survive inflation, FX woes, and policy uncertainty?

By Michael Kalu

For the ninth month in a row, private sector sentiment in Nigeria has posted an upswing, signaling resilience in the face of economic turbulence. But beneath the optimism lies a delicate balancing act: soaring inflation, volatile foreign exchange markets, and unpredictable policy shifts continue to cast long shadows over the fragile recovery.

Analysts warn that while the sustained confidence reflects adaptability and renewed investor appetite, the real question is whether this momentum can withstand the structural headwinds threatening to choke long-term growth.

The purchasing-manager index compiled by Stanbic IBTC Bank and S&P Global rose to 54.2 points in August from 54 a month earlier. Readings above 50 signal an improvement in business conditions, while those below indicate a deterioration.

The reading shows “a sustained improvement in the health of the Nigerian private sector,” Stanbic and S&P said in a statement on Monday. “The rise in the headline index primarily reflected sharper expansions in output and new orders, with rates of growth hitting four- and 19-month highs respectively,” they said.

Improved customer demand led firms to step up purchases of inputs, and a positive outlook has encouraged inventory accumulation, Stanbic and S&P said.

The Nigerian economy is on track to grow 3.5% this year, marginally up from 3.4% in 2024, “supported by softer inflation, improvement in FX liquidity conditions and structural reforms,” Muyiwa Oni, head of equity research for West Africa at Stanbic, said in the statement.