Nigeria’s economic activity slipped into contraction in April 2026, as the Purchasing Managers’ Index (PMI) fell to 49.4 — its first decline after 16 consecutive months of expansion.
The latest report released by the Central Bank of Nigeria (CBN) on Wednesday shows the index dropped below the 50-point benchmark that separates expansion from contraction, pointing to a broad-based slowdown across key sectors of the economy.
According to the report, the marginal decline reflects weakening demand conditions and reduced business activity, particularly in the industry and services sectors, even as agriculture maintained modest growth.
“The composite Purchasing Managers’ Index (PMI) for April 2026 stood at 49.4 points, marginally below the 50-point threshold, indicating a slight contraction in aggregate economic activity following sixteen consecutive months of expansion,” the CBN stated.
A closer look at the data reveals declining momentum across major indicators. Output fell to 49.7, new orders dropped more sharply to 48.4, while employment slipped to 49.6 — all suggesting reduced economic activity and cautious business sentiment.
Inventory levels also weakened, with the stock of raw materials index at 48.7, indicating that firms scaled back purchases. However, supplier delivery time improved slightly to 50.9, suggesting marginal gains in supply chain efficiency despite the slowdown.
Across the 36 subsectors surveyed, 19 recorded contraction, one remained unchanged, while 16 posted expansion. Primary metals recorded the steepest decline, whereas forestry emerged as the fastest-growing subsector.
The report attributed the moderation in business conditions partly to external pressures, including heightened geopolitical tensions in the Middle East, which may have disrupted supply chains and dampened investor confidence.
Sectoral analysis shows the downturn was most pronounced in industry and services. The industry PMI stood at 49.5, indicating marginal contraction. While production remained slightly positive at 50.2, new orders and employment declined to 49.5 and 48.7, respectively, reflecting weaker demand and restrained hiring.
Raw material inventories in the industrial sector dropped sharply to 46.8, suggesting firms cut back on input purchases amid prevailing uncertainties. Eight of the 17 industrial subsectors recorded contraction.
The services sector recorded a deeper decline, with its PMI at 48.8 — its first contraction in 14 months. Output, new orders, employment, and inventories fell to 49.2, 47.5, 49.0, and 49.5, respectively. Ten of the 14 services subsectors contracted, with transportation and warehousing recording the sharpest drop, while educational services posted the strongest growth.
In contrast, agriculture remained resilient, with PMI at 50.2, extending its expansion streak to 21 consecutive months. Growth in the sector was supported by general farming activities (50.5) and employment (52.1), although declines in new orders and raw material inventories point to emerging underlying pressures.
Three of the five agricultural subsectors recorded expansion, one remained unchanged, and one contracted, with forestry again leading growth.
Meanwhile, inflationary pressures intensified during the period. Both input and output price indices rose by 3.2 points in April, indicating that higher production costs are increasingly being passed on to consumers. Output prices rose faster than input costs in the industry and agriculture sectors, suggesting firms are adjusting prices to protect margins.
For context, Nigeria’s PMI stood at 53.2 points in March 2026, underscoring the abrupt shift in economic conditions within a single month.
Overall, the April data highlights a fragile economic landscape, where weakening demand, rising costs, and external uncertainties are beginning to weigh on business activity — raising fresh concerns about the sustainability of recent growth momentum.
