Nigeria’s business activity expanded for the second straight month in July, as stronger growth in the services and agriculture sectors outweighed the continued slowdown in industry, according to the Central Bank of Nigeria’s (CBN) latest Purchasing Managers’ Index (PMI) report.

The composite PMI rose to 51.1 points in July from 50.1 points in June, signalling sustained expansion in overall economic activity.

The report showed that 20 of the 32 subsectors surveyed recorded growth during the month, while 12 contracted, pointing to improving business conditions despite lingering weakness in parts of the economy.

The survey said the recovery was driven largely by the services and agriculture sectors, which more than offset the contraction recorded by industry.

“The July 2026 PMI points to a recovery in overall economic activity, driven by sustained expansion in the Agriculture and Services sectors, which offset the contraction recorded in the industry sector,” the report stated.

The report also indicated that business conditions improved further during the month, with output, employment and new orders all remaining above the 50-point threshold.

Output stood at 51.8 points, employment at 51.1 points and new orders at 50.8 points, reflecting continued recovery across key business indicators. Suppliers’ delivery time also improved, rising to 51.3 points, while the stock of raw materials remained in contraction at 49.6 points.

Industry remained the weakest segment of the economy, although the pace of decline eased slightly. The sector’s PMI improved marginally to 49.6 points in July from 49.5 points in June, remaining below the 50-point benchmark that separates expansion from contraction.

The slowdown was linked to lower production, weaker new orders and declining raw material inventories, even as employment and suppliers’ delivery time stayed in expansionary territory.

Half of the 16 industrial subsectors expanded during the month, while the remaining half contracted, reversing the sector’s previous expansionary trend. Oil refining recorded the sharpest decline in activity, while electrical and electronics posted the strongest growth among all 32 subsectors surveyed.

The services sector returned to growth after three consecutive months of contraction. Its PMI climbed to 51.1 points in July from 49.4 points in June, supported by stronger business activity, rising employment and increased new orders.

Eight of the 11 services subsectors expanded during the month, with administrative and support services recording the strongest growth, while transportation, courier and storage posted the steepest contraction.

Agriculture maintained its growth momentum for the 24th consecutive month, with the sector’s PMI remaining at 52.1 points. Four of the five agricultural sub-sectors expanded, while crop production was the only segment to contract. General farming activities, new orders, employment and inventories all remained in expansionary territory during the review period.

The report also pointed to easing cost pressures across the economy. Composite input and output price indices fell to 1.6 points and 3.1 points respectively in July, suggesting slower increases in production costs and selling prices.

Overall, the apex bank said the combination of sustained expansion in services and agriculture alongside moderating price pressures reflects improving business conditions and provides “a cautiously optimistic outlook for economic growth in the near term”.