Nigeria’s business activity climbed to a record high in September even as the surge in demand failed to translate into stronger financial performance, with businesses mired in high operating costs, financing constraints and other structural bottlenecks.

The Nigerian Economic Summit Group (NESG), in its latest Business Confidence Monitor, said the Current Business Performance Index rose to 117.8 points in September from 112.7 points in August and 107.9 points a year earlier, surpassing the previous record of 117.2 points recorded in February.

The report, titled Strong Demand Ignited Business Growth amid Persistent Cost Pressures, however, showed that the improvement in business activity was not matched by an equally strong performance in business finances.

While most confidence sub-indices remained in expansion territory, the Financial Results Index slipped into contraction after several months of expansion, underscoring the pressure businesses continue to face despite stronger demand.

The divergence was also reflected in the NESG’s cost indicators, with the Cost of Doing Business and Prices sub-indices remaining deeply below the 100-point neutral threshold at 39.2 and 58 points, respectively.

The figures suggest that businesses are recording higher levels of activity while still operating under severe cost pressures.

Trade emerged as the biggest driver of the September expansion, with its Current Business Performance Index jumping to 128.5 points from 112 points in August and 107.6 points a year earlier.

NESG attributed the strong performance partly to increased trade stockpiling linked to back-to-school shopping and stronger consumer demand, with both wholesale and retail trade benefiting from the improvement.

Agriculture also strengthened, rising to 117.7 points from 110.5 points in August and 107.3 points a year earlier, although forestry and fishing moved into contraction.

The improvement in overall activity was moderated by weaker manufacturing and services performance.

Manufacturing’s index fell sharply to 108.4 points from 120.4 points in August, although it remained above the 102.5 points recorded in September 2025. Cement and several other manufacturing subsectors weakened during the month.

Services remained in expansion but slowed to 107.7 points from 112.4 points in August and 108.5 points a year earlier.

Non-manufacturing, however, improved to 113.4 points from 109.7 points in August, supported partly by crude petroleum, which moved into expansion, even as oil and gas services contracted.

According to NESG, businesses across the economy continued to face financing constraints, irregular electricity supply, insecurity, infrastructure bottlenecks and high rental costs, while manufacturers also struggled with raw-material supply challenges.

The pressure on investment was particularly significant, as the group noted that the Investment Index moved into expansion after several months of contraction.

This suggests that improved demand is beginning to encourage businesses to increase investment, although persistent high costs could constrain the extent of the recovery.

Businesses nevertheless remained optimistic about the near-term outlook, with the Future Business Expectation Index standing at 128.9 points in September, only slightly below 129.3 points in August.

Trade had the strongest outlook at 192 points, followed by Manufacturing at 151.9 points and non-manufacturing at 148.1 points.

Agriculture recorded 134.8 points, while Services posted 123.2 points.

NESG said persistent cost pressures, alongside constraints around finance, electricity, infrastructure and security, remained major factors weighing on business activity and new investment.

The September data therefore presents a mixed picture of Nigeria’s private sector: businesses are experiencing stronger demand and record activity, but the improvement is yet to eliminate the cost pressures eroding financial performance.