Nigeria’s private sector recorded a historic decline in January 2026, as the Stanbic IBTC Purchasing Managers’ Index (PMI) fell to 49.7 from 53.5 in December. This marks the first time since the survey began in January 2014 that the headline index for the first month of the year has dipped below the 50.0 no-change threshold, signaling a contraction in business conditions.
The downturn was primarily driven by a stagnation in new orders following 14 consecutive months of growth, as the typical post-festive lull in consumer spending was compounded by “deeper issues” in the wholesale and retail sectors.
While agriculture, manufacturing, and services managed to stay within growth territory, the wholesale and retail sectors saw a significant drop, pulling the overall average down. Despite the lull in orders, companies reported that purchase prices and staff costs increased at their fastest rates in months, forcing many to raise selling prices to protect margins.
Interestingly, employment continued to rise for the eighth straight month, as firms utilized the downtime to clear their largest volume of backlogged work since March 2025.
Economists at Stanbic IBTC, led by Muyiwa Oni, noted that while a January slowdown is seasonal, the breach of the 50-point mark suggests that weakened disposable income is finally catching up with business output.
However, the report maintains a “cautiously optimistic” outlook, with 80 percent of surveyed firms expecting an increase in output over the next 12 months due to planned expansions and hope for a recovery in demand. The bank still forecasts a 4.1 percent GDP growth for Nigeria in 2026, betting on a rebound once the current lull subsides.
 fell to 49.7 from 53.5 in December. This marks the first time since the survey began in January 2014 that the headline index for the first month of the year has dipped below the 50.0 no-change threshold, signaling a contraction in business conditions.){kind=link}