Nigeria’s business activity returns to expansion as agriculture lifts economy

Nigeria’s business activity returned to expansion in June 2026 after contracting in the previous month, as sustained growth in the agriculture sector outweighed continued weakness in the industry and services sectors, according to the Central Bank of Nigeria (CBN).

 

The June 2026 Purchasing Managers’ Index (PMI) survey, conducted by the CBN between June 8 and 12, 2026, was designed to gauge the direction of economic activities in Nigeria for the month.

 

The survey showed that the composite PMI rose to 50.1 points in June from 49.6 points recorded in May, signalling a return to expansion in overall economic activity. A PMI reading above 50 indicates expansion in business activities, while a reading below 50 points to contraction.

 

The modest improvement suggests that business conditions recovered during the month, although the rebound remained uneven across key sectors of the economy.

 

According to the report, the recovery was driven almost entirely by the agriculture sector, which recorded a PMI of 52.1 points in June, marking the twenty-third consecutive month of expansion. All five agricultural subsectors surveyed posted growth during the review period, underscoring the sector’s continued resilience despite broader economic challenges.

 

In contrast, the industry and services sectors remained in contraction. The Industry PMI improved marginally to 49.5 points from 49.3 points in May, indicating a slower pace of contraction. Of the 17 industrial subsectors surveyed, 11 recorded declines in business activity, while six expanded.

 

Similarly, the Services PMI stood at 49.4 points, reflecting continued contraction in business activity. Although eight of the 14 services subsectors recorded growth, six posted declines, leaving the overall sector below the expansion threshold.

 

Overall, 19 of the 36 subsectors surveyed across the economy recorded expansion in June, while the remaining 17 reported declines. Forestry emerged as the fastest-growing subsector during the month, while Primary Metal recorded the steepest contraction.

 

The report also pointed to easing inflationary pressures on businesses. The composite input price index declined by 2.5 points, while the output price index fell by 0.8 point in June, indicating a moderation in both production costs and selling price pressures.

 

A breakdown of the composite PMI components showed that employment and output returned to expansion, with the Employment Index rising to 51.0 points and the Output Index increasing to 50.5 points. However, demand conditions remained weak, as the New Orders Index stayed in contraction at 49.0 points.

 

The Stock of Raw Materials Index also remained below the 50-point threshold at 49.5, suggesting businesses continued to draw down inventories. Meanwhile, the Suppliers’ Delivery Time Index rose to 50.9 points, indicating an improvement in supplier response times and supply chain conditions.

 

The CBN said the June PMI points to a modest recovery in overall economic activity, supported by the sustained performance of the agriculture sector, which offset contractions in the industry and services sectors. While the return of the composite PMI to expansion territory signals improving business conditions, the continued weakness in new orders and the contraction in the two largest non-agricultural sectors suggest that the recovery remains gradual and is yet to become broad-based.