By Bamidele Famoofo
Nigeria’s economic activity showed a noticeable moderation in April 2026, with the Composite Purchasing Managers’ Index (PMI) declining to 49.4 points, slipping below the 50-point threshold for the first time in sixteen months. While this marks a technical contraction, the data suggests a gradual loss of growth momentum rather than a sharp downturn in economic conditions.
The underlying drivers of this shift are largely demand-related. New Orders fell to 48.4 points, while Output moderated to 49.7 points, both reflecting softer business activity and weaker consumer demand. This cooling trend extended to the labour market, where Employment declined to 49.6 points, indicating a more cautious approach to hiring by firms. In parallel, businesses scaled back inventory accumulation, with the Stock of Raw Materials Index at 48.7 points, pointing to more defensive operational and balance sheet decisions.
One area of relative stability was observed in supply chain performance. The Suppliers’ Delivery Time Index improved to 50.9 points, suggesting that delivery timelines became more efficient. However, this improvement appears to be driven more by reduced pressure on supply systems rather than stronger demand conditions.
Across sectors, the slowdown was most evident in Industry and Services. The Industry PMI stood at 49.5 points, indicating a marginal contraction. Although Output remained slightly expansionary at 50.2 points, this strength appears to reflect ongoing production rather than new demand inflows. Supporting this view, both New Orders (49.5 points) and Employment (48.7 points) declined, while the Raw Materials Inventory Index dropped further to 46.8 points, highlighting reduced manufacturing intensity.
The Services sector recorded a PMI of 48.8 points, marking its first contraction after fourteen consecutive months of expansion. The slowdown was broad-based, with Business Activity at 49.2 points, New Orders at 47.5 points, Employment at 49.0 points, and Inventories at 49.5 points. The weakness in transportation and warehousing points to moderating trade and logistics activity, reinforcing the view that demand-side pressures are becoming more pronounced
In contrast, the Agriculture sector remained in expansionary territory at 50.2 points, extending its growth streak to twenty-one consecutive months.
The sector continued to benefit from relatively strong Employment (52.1 points) and General Farming Activities (50.5 points). However, declines in new orders and raw material stocks within the sector suggest that even this area of resilience may begin to face headwinds if broader economic conditions remain subdued.
Looking at the wider economy, the breadth of activity tilted slightly negative. Out of 36 subsectors surveyed, 16 recorded expansion, 19 contracted, and 1 remained unchanged. Forestry posted the strongest growth, while primary metals experienced the steepest decline, reflecting weaker industrial demand.Price developments remained firm during the period. Both input and output price indices rose by 3.2 points in April. Notably, in the Industry and Agriculture sectors, output prices increased at a faster pace than input costs, suggesting that firms retained some ability to pass on rising costs, likely as a means of preserving margins in a slowing environment.
