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By Chinwendu Obienyi
Nigeria’s overall economic activity extended its recovery for a third consecutive month in August 2026, with the Central Bank of Nigeria (CBN)’s composite Purchasing Managers’ Index (PMI) rising to 52.7 points from 51.1 in July.
According to the apex bank, the survey covers 1,900 respondents (Companies Purchasing and Supply Executives) drawn from the three sectors of the economy, namely: Industry, Services, and Agriculture.
The reading, released on yesterday by the CBN’s Statistics Department, revealed that the services sector posted a PMI of 53.3 in August, marking the second straight month of expansion after earlier contractions.
It said that 9 of the 11 services subsectors surveyed recorded growth, led by administrative and support services, while professional, scientific and technical services remained the weakest link.
The breadth of expansion suggests improving domestic demand and activity across retail, transport, hospitality and related industries.
Also, agriculture remained the most consistent engine of growth. The agriculture PMI increased to 53.4, extending an unbroken run of expansion to 25 months.
All five agricultural subsectors expanded, with forestry leading the way and general farming activities at a robust 56.5. Within farming, new orders, employment and inventories all stayed above the 50-point threshold, pointing to rising activity, hiring and stock-building on farms.
Meanwhile, the industrial sector returned to growth after four months of contraction, with the industry PMI edging up to 50.6 in August. However, the recovery remains fragile as only five of the 16 industrial subsectors expanded, while 11 recorded declines.
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This narrow base underscores persistent constraints on manufacturing, including high production costs, power shortages and uneven demand.
The mixed industrial picture aligns with earlier warnings that rising input costs could derail a factory recovery even as activity stabilises. Policymakers are likely to view the return to above-50 as encouraging but insufficient to drive a strong jobs and output boom without complementary measures on infrastructure and financing.
On prices, the CBN report showed the composite input price index fell by 0.2 points in August, while the output price index rose by 1.0 points. The divergence suggests firms are beginning to pass more costs on to customers even as the pace of input-cost increases moderates slightly.
That dynamic could keep core inflation sticky, complicating the monetary policy outlook even as growth improves.
The CBN data dovetails with a separate private-sector PMI compiled by Stanbic IBTC and S&P Global, which rose to 54.3 in August from 52.5 in July, the strongest reading in about 29 months. That survey, covering around 400 firms across agriculture, mining, manufacturing, construction, wholesale, retail and services, pointed to surging new orders and output. Together, the two PMIs paint a picture of broadening private-sector momentum, albeit with industry still lagging services and agriculture.
For the apex bank, the August PMI supports a narrative of gradual, uneven recovery. Sustained expansion above 50 reduces the case for further aggressive tightening, but persistent output-price growth and a fragile industrial base argue against a rapid pivot to easing.
But for fiscal authorities, the narrow industrial expansion reinforces the need to prioritise power, logistics and credit access if manufacturing is to become a stronger driver of jobs and value addition
signals continued expansion in private-sector business conditions, driven by resilient services and agriculture and a tentative rebound in industry.
