The International Monetary Fund (IMF) has upgraded Nigeria’s economic growth outlook for 2025 to 3.9 percent, citing stronger domestic fundamentals, renewed investor confidence, and limited exposure to global trade tensions.
The new forecast, contained in the IMF’s October 2025 World Economic Outlook (WEO) titled “Global Economy in Flux”, marks a 0.5 percentage point increase from the Fund’s July projection and nearly 1 percentage point higher than its April forecast.
According to the report, Nigeria’s real Gross Domestic Product (GDP) is expected to grow by 3.9 percent in 2025, slightly lower than the 4.1 percent recorded in 2024, but projected to accelerate to 4.2 percent in 2026.
The IMF attributed the improved outlook to higher oil output, a supportive fiscal policy, and growing investor optimism. It also highlighted the positive impact of energy and financial sector reforms, which have attracted fresh capital inflows, while exchange rate adjustments have improved transparency in the foreign exchange market.
The Fund further observed that Nigeria’s economy is less vulnerable to the global tariff wars triggered by new U.S. trade measures, which have slowed growth in many advanced economies.
Despite the improved outlook, inflation remains a concern. The IMF projected that Nigeria’s average consumer prices will ease from 31.4 percent in 2024 to 23.0 percent in 2025, and further to 22.0 percent in 2026. End-of-period inflation is forecast to decline from 21 percent in 2025 to 18 percent in 2026, reflecting gradual disinflation amid persistent food and energy price pressures.
On the external front, Nigeria’s current account surplus is expected to narrow from 6.8 percent of GDP in 2024 to 5.7 percent in 2025, and further to 3.6 percent in 2026, as higher import levels offset oil export gains.
The IMF also confirmed a major rebasing of Nigeria’s national accounts, adopting 2019 as the new base year. The revised data incorporate previously underreported sectors — including digital services, informal agriculture, and modular refining — boosting the country’s nominal GDP by more than 40 percent.
At a press briefing, Denz Igan, Division Chief at the IMF’s Research Department, explained that the upgrades were driven by “reduced uncertainty and Nigeria’s limited exposure to U.S. tariffs, given its relatively low dependence on global trade.”
He added: “Since July, we’ve seen exchange rate appreciation, stronger financial conditions supported by rising investor confidence, and a supportive fiscal stance. In addition, hydrocarbon growth has been revised upward due to higher oil production and improved security in producing areas.”
While welcoming Nigeria’s improved performance, the IMF urged authorities to maintain credible fiscal and monetary policies, strengthen institutional frameworks, and accelerate reforms aimed at fostering macroeconomic stability and inclusive growth.
