Analysts at Cowry Asset Management Limited have raised concerns over Nigeria’s short-term economic performance following new data showing a slowdown in business activity across key sectors.
Their latest review of the April 2026 Purchasing Managers’ Index (PMI) released by the Central Bank of Nigeria indicates that economic momentum weakened significantly during the month.
First Contraction in Over a Year
The composite PMI fell to 49.4 points, dropping below the 50-point benchmark that separates expansion from contraction for the first time in 16 months. This signals a technical contraction in private sector activity.
According to Cowry Asset, the decline reflects reduced performance in new orders, production output, and employment levels across businesses.
Broad-Based Weakening Across Sectors
Out of 36 subsectors surveyed, only 16 recorded growth, while 19 contracted and one remained stable. Analysts say this indicates a broad-based slowdown rather than a sector-specific disruption.
The firm noted that businesses are beginning to experience weaker demand conditions, which may affect output stability if the trend continues.
Inflation and Policy Pressure Complicating Outlook
Cowry Asset also warned that Nigeria is facing a dual challenge: slowing growth combined with persistent inflationary pressures. This creates a difficult environment for policymakers trying to stabilize the economy without stifling activity.
Investor Reaction and Market Impact
The analysts expect investor sentiment to become more cautious in the short term. Fixed-income assets may attract more attention as risk appetite declines, while the equities market could see clearer differentiation between defensive and cyclical stocks.
Outlook for Coming Months
Attention is now focused on PMI readings for May and June, which will determine whether April’s decline is a temporary fluctuation or the beginning of a sustained slowdown in Nigeria’s economic trajectory.
For now, the data points to a moderation phase in the economy, signaling that growth is losing some of its earlier momentum across Nigeria.
