Nigerian Economy Sees Growth Amid Rising Inflation

Nigerian private sector activity expanded in September with new orders mainly in chemical and pharmaceutical products driving growth. The central bank's purchasing managers index increased slightly, marking continuous expansion. However, reforms by President Bola Tinubu have led to inflation, impacting the economy and borrowing costs.

Nigerian private sector activity expanded for a second consecutive month in September, buoyed by a rise in new orders, particularly in the chemical and pharmaceutical industries, according to recent central bank data.

The purchasing managers' index (PMI) for the private sector climbed to 50.5 points from August's 50.2, surpassing the 50-point threshold that indicates growth.

The PMI, a crucial economic indicator considered by the central bank's monetary policy committee in interest rate decisions, comes amid inflationary pressures from President Bola Tinubu's currency market reforms and subsidy cuts.

Despite the positive PMI, inflation has diminished spending power while increased interest rates have raised borrowing costs, dampening economic activity according to analysts.

(With inputs from agencies.)