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By Daniel Adaji
Nigeria is targeting a stronger economic expansion of 4.49 per cent in 2026, driven by easing monetary conditions, sustained structural reforms and increased investment across key sectors.
This is according to the Central Bank of Nigeria’s (CBN) Macroeconomic Outlook available to Pointblanknews.com on Tuesday.
The apex bank said the growth projection reflects expectations that reforms implemented over recent years will continue to stabilise the macroeconomic environment, improve investor confidence and support private-sector-led growth, even as global economic uncertainties persist.
The outlook builds on Nigeria’s solid performance in 2025, when the economy grew by an estimated 3.89 per cent, up from 3.38 per cent in 2024. That improvement was supported by stronger output in both the oil and non-oil sectors, alongside tighter policy coordination that helped moderate inflationary pressures.
Globally, economic growth slowed slightly to an estimated 3.20 per cent in 2025, compared with 3.30 per cent in 2024, largely due to lingering trade tensions and weaker demand in major economies. Global inflation, however, eased to 4.20 per cent, helped by lower energy prices and improving supply chains.
Financial conditions also loosened in many economies as inflation moderated, monetary policies became less restrictive and investor confidence improved.
At home, inflation dynamics showed signs of improvement. Following the rebasing of the Consumer Price Index (CPI) by the National Bureau of Statistics, headline inflation, which stood at 24.48 per cent in January 2025, fell to an estimated average of 21.26 per cent for the year. The CBN attributed this moderation to a tight monetary stance, improved exchange rate stability and better fiscal-monetary coordination.
In the financial sector, growth in monetary aggregates slowed in 2025 as interest rates rose and money market conditions tightened. However, the CBN eased its policy stance in September 2025 to support domestic growth and investment. The banking system remained stable, with key financial soundness indicators staying broadly within regulatory benchmarks, supported by enhanced oversight and macro-prudential measures.
Fiscal conditions also improved in 2025, aided by policy and institutional reforms, stable crude oil prices and steady domestic production. Total public debt stood at 33.98 per cent of GDP by end-June 2025, with domestic debt accounting for 52.86 per cent and external debt 47.14 per cent.
Nigeria’s external position remained positive, recording an estimated balance of payments surplus of US$5.80 billion in 2025. External reserves rose to about US$45.01 billion, up from US$40.19 billion in 2024, supported by higher capital inflows, stronger export receipts and expanding domestic refining capacity. Reforms in the foreign exchange market also helped sustain relative exchange rate stability.
Looking ahead, the CBN expects inflation to ease further to an estimated 12.94 per cent in 2026, driven mainly by declining food prices and lower premium motor spirit (PMS) costs. Growth momentum is expected to be reinforced by increased oil production and investment, improved security around critical assets and further gains from domestic refining.
The capital market is projected to remain bullish in 2026, supported by the ongoing bank recapitalisation exercise, rising investor confidence and broader growth-oriented policies. Monetary aggregates are expected to be influenced by exchange rate movements, fiscal operations, election-related spending and continued prudential measures.
On the fiscal side, the outlook for 2026 remains optimistic, anchored on stronger non-oil revenue mobilisation and the continued implementation of the Nigeria Tax Act, 2025. Federal Government retained revenue is projected at ₦35.51 trillion, while expenditure is estimated at ₦47.64 trillion, resulting in a provisional deficit of ₦12.14 trillion, equivalent to 3.01 per cent of GDP. Public debt is projected to rise modestly to 34.68 per cent of GDP by end-2026, reflecting anticipated new borrowings.
Externally, Nigeria is expected to sustain its positive trajectory in 2026, with the current account surplus projected at US$18.81 billion, supported by strong exports, steady remittance inflows, higher oil and gas output and rising global demand. External reserves are projected to climb further to US$51.04 billion, while reforms in the foreign exchange market are expected to reinforce stability.
Despite the optimistic outlook, the CBN cautioned that risks remain. Unexpected inflationary pressures, fiscal slippages, global financial market shocks, adverse climatic conditions and disruptions to crude oil production could weaken growth and destabilise the exchange rate. Rising non-performing loans and concentration risks linked to banking sector recapitalisation could also pose challenges to financial stability.
In response, the bank said it would remain committed in 2026 to balancing price stability with output growth, deploying appropriate policy tools to attract foreign investment, safeguard the financial system and consolidate gains in the foreign exchange market
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