In October 2025, Nigeria’s business environment maintained its positive trajectory, with the Current Business Performance Index remaining in the expansion zone.
The NESG– Stanbic IBTC Business Confidence Monitor (BCM) recorded a marginal increase to 111.3 points from 107.9 points in September 2025 and 76.8 points in the same period of 2024.
This improvement reflects a mix of sectoral dynamics, particularly strengthened business performance across sectors and a surge in growth within the manufacturing sector.
A sectoral review showed that all five broad economic activities remained in the expansion region. The Manufacturing and Trade sectors recorded the strongest gains, rising by 8.8 and 7.8 points to 111.3 and 115.4, respectively, during the month. Non-Manufacturing (115.0), Agriculture (111.4), and Services (111.0) also expanded, albeit at a slower pace than in September 2025. Key BCM sub-indices—investment, exports, access to credit, and prices—posted modest improvements relative to August 2025, indicating a more positive outlook for capital formation and external trade.
During the month, the cost of doing business and input prices reversed the previous month’s improvement, though at a slower rate, suggesting a gradual easing of inflationary pressures on firms. However, lingering financing constraints, high commercial property costs, unclear policy signals, erratic power supply, and persistent insecurity continued to dampen business performance and confidence.
Comment by Stanbic IBTC
Broad sectoral improvement in activities influenced an increase in Nigeria’s business conditions for the third consecutive month, extending the expansion in general activities for the 11th month running.
More Notably, the Manufacturing sector improved the most in October, amid higher production, improved demand, and increased access to credit. We believe lower inflation and stable exchange rate supported an improvement in demand and production. Indeed, the breakdown of the Manufacturing sector showed better performance across the food & beverage; cement; and plastic & rubber products sub-sectors.
Nonetheless, the level of optimism in October was lower than that seen in September, reflecting weaker optimism level across Manufacturing sector; non-manufacturing industries; and Services. Where future sentiments increased, survey participants linked it to ongoing policy reforms, stable exchange rate, gradual recovery in consumer demand, and seasonal economic activity.
Going into 2026, the non-oil sector’s growth should remain strong amid a likely reduction in interest rates and low inflation, both of which should support aggregate demand and private investment. Further, a likely less exchange rate volatility in 2025 and 2026 based on our current estimates should support growth across trade, manufacturing, real estate, and construction.
Aside from that, the forward-linkage impact of Dangote Refinery should benefit manufacturing growth in the medium term. The IMF expects the Dangote Refinery to increase non-oil GDP growth by c.1.5% in 2026. Oil refining has already grown for a third consecutive quarter, to 15.78% y/y in Q2:25, from 11.51% y/y in Q1:25, although its contribution to the manufacturing sector remains insignificant, at 0.1%.
Headline inflation softened to 18.02% y/y in September, and we expect price moderation towards 15.84% – 16.22% y/y in October and 14.25% – 14.62% y/y in November. This is because we see food prices moderating further in the coming months in line with the ongoing main harvest season which is expected to ensure food prices remain at their seasonal low level until December, when gradual depletion of household stocks will likely commence.
Simultaneously, non-food inflation should be pressured in October amid higher fuel prices relative to September, understandably due to supply constraints and production glitches at the Dangote refinery which contributes 30.0% – 40.0% of domestic petrol supplies.
Nonetheless, the lingering local currency stability and appreciation should help provide some succour to non-food inflation in the near term.
