FMI projects 37% Inflation for Nigeria in 2026

The International Monetary Fund (IMF) has provided for a strong rebound in the inflation of Nigeria, providing for a main rate of 37% in 2026, even if in 2025 a temporary relief is expected with inflation with an average of 26.5%.

This has been disclosed in the FMI world’s economic prospects (WEO), which highlights the persistent economic fragility in Nigeria despite the recent political reforms.

The forecast of inflation comes in the wake of an index of consumer prices (CPI) which rebels by the National Bureau of Statistics (NBS), which has seen recalibrated inflation figures to reflect more current consumer models.

The fund observed that although inflation can alleviate this year from 33.2% recorded in 2024, the stability of the price supported remains uncertain between current structural challenges and global volatility.

The IMF also reviewed the growth of Nigeria’s growth of 2025 per 3.0%, from a previous estimate of 3.2%. Growth should slow down to 2.7% further in 2026, largely due to the drop in oil revenue.

The royal income of Nigeria is expected to grow marginally, only 0.6% in 2025 and 0.3% in 2026, for the reduction of concerns on the quality of economic expansion and on its impact on living standards.

In the meantime, the country’s external balance is under fresh control. The current account surplus, which stands at 9.1% of GDP in 2024, should restrict 6.9% in 2025 and 5.2% in 2026.

This perspective is threatened by the possibility that prolonged oil prices drop below the tax tie of $ 60 Nigeria per barrel, a scenario marked by JP Morgan.

Fitch’s assessments, however, remain slightly more optimistic, projecting a moderate surplus of 3.3% of GDP due to the earnings foreseen by refinery and energy reform projects.

In January, the NBS reduced the CPI, updating the basic year from 2009 to 2024. This adjustment saw the January inflation recalculated at 24.48%, decreasing from 34.80% in December 2024.

The trend continued with 23.18% in February before tracing again at 24.23% in March, indicating the persistent pressure of the cost of living.

Food inflation, an important component of the Nigeria inflation basket, has seen a marginal drop in February but remains high.

The central bank of Nigeria (CBN) has maintained the stable monetary policy rate at 27.5%, underlining a cautious approach as it balances the control of inflation with economic growth.

While recognizing the recent bold steps of Nigeria, including the removal of fuel subsidies, the unification of the exchange rate and the arrest of the financing of the CBN deficit – the IMF stressed the urgent need for deeper reforms.

These, observed the fund, must affect structural inefficiencies, improve productivity and guarantee more equitable economic results.

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