THUR APRIL 30 2026-theGBJournal| Nigeria’s private sector slipped into mild contraction in April 2026 for the first time in 16 months, as weakening demand, softer business activity and rising geopolitical risks pushed the Central Bank of Nigeria’s (CBN) Composite Purchasing Managers’ Index (PMI) below the growth threshold.
The CBN’s April 2026 PMI report showed the Composite PMI fell to 49.4 points, down from expansion territory and just below the 50-point benchmark that separates growth from contraction.
The reading signals a modest decline in aggregate economic activity and marks the end of a 16-month expansion streak, pointing to a loss of momentum in business conditions across the economy.
The downturn was driven largely by weakness in the industry and services sectors, both of which slipped into contraction during the month, offsetting continued resilience in agriculture.
The Industry PMI stood at 49.5 points in April, indicating mild contraction in manufacturing and industrial activity.
Of the 17 industrial subsectors surveyed, eight reported declining activity, underscoring the broad-based softness in production conditions.
The Services PMI was weaker at 48.8 points, making it the poorest-performing major sector in the review period.
Ten of the 14 services subsectors recorded contraction, reflecting reduced business activity across trade, logistics, consumer-facing services and other key segments of the economy.
Agriculture remained the lone bright spot, with its PMI at 50.2 points, sustaining expansion for the 21st consecutive month. Of the five agricultural subsectors surveyed, three recorded growth, one was unchanged and only one posted a marginal decline, reinforcing the sector’s role as a stabilising buffer in Nigeria’s fragile growth environment.
A breakdown of the underlying indicators points to weakening demand and slowing business momentum. The Output Index fell to 49.7 points, New Orders dropped more sharply to 48.4 points, while Employment declined to 49.6 points.
Together, these readings suggest softer consumer demand, weaker order books and slower hiring decisions by firms, all of which are consistent with a broad moderation in private sector activity.
The report also showed that both input and output price indices rose at the same pace in April, indicating that firms continued to face elevated cost pressures while passing those costs on to consumers through higher selling prices. This suggests inflationary pressures remain embedded in the economy, even as growth weakens — a troubling mix for businesses and policymakers alike.
The April PMI reading highlights growing fragility in Nigeria’s economic recovery. After more than a year of gradual expansion, the return to contraction suggests that businesses are increasingly contending with weaker demand, tighter financial conditions and heightened external uncertainty.
The CBN linked the slowdown partly to rising geopolitical tensions and uncertainty in the Middle East, which have amplified global risk sentiment and may be feeding into higher energy costs, supply chain pressures and weaker investor confidence.
For Nigeria, this adds another layer of vulnerability to an already strained domestic economy grappling with inflation, elevated borrowing costs and subdued consumer purchasing power.
While the contraction remains marginal, the April PMI data sends a clear warning: Nigeria’s private sector recovery is losing steam, and without stronger demand support or improved macroeconomic stability, growth conditions could remain fragile in the months ahead.
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