…Forecasts 37% Inflation Rate In 2026
The International Monetary Fund (IMF) has projected that Nigeria’s economy will grow by 3.0% in 2025, representing a 0.2 percentage point reduction from its previous growth projection of 3.2% for the country.
The Washington D.C-based development finance institution revised the nation’s growth rate in 2026 to 2.7%.
Curiously, the IMF in its latest World Economic Outlook report released on Tuesday, projected that Nigeria’s headline inflation would average 26.5% this year and that the rate was expected to surge to 37.0% in 2026, based on the rebased CPI by the National Bureau of Statistics (NBS).
The Fund hinged the downward review of Nigeria’s growth projections to decline in global crude oil prices and other challenges, particularly the surging inflation, forex volatility, and weak infrastructure of the economy.
However, the IMF noted that recent policy adjustments, such as the partial unification of exchange rates and removal of fuel subsidy, could enhance investor confidence and stimulate economic activity if properly implemented.
It clarified: “For sub-Saharan Africa, growth is expected to decline slightly from 4.0% in 2024 to 3.8% in 2025, before recovering modestly to 4.2% in 2026.
“Among the larger economies, the growth forecast for Nigeria is revised downward by 0.2 percentage point for 2025 and 0.3 percentage point for 2026, owing to lower oil prices”, the IMF added.
This is even as it revised South Africa’s growth forecast downward by 0.5 percentage point for 2025 and 0.3 percentage point for 2026, based on a weaker-than-expected 2024 performance, deteriorating sentiment due to heightened uncertainty, intensification of protectionist policies, and a deeper slowdown in major economies.
Meanwhile, the current Federal Government’s Medium Term Expenditure Framework (MTEF) forecasts the economy to grow at 4.6% in 2025.
With the MTEF’s projections not achieved over the past years, experts believe that the 4.6% target set by the government for this year may not be achievable given the sundry challenges, particularly surging inflation, forex market volatility, and insecurity at the domestic level and the negative implications of President Donald Trump’s tariffs on exports to the United States.
