Nigeria’s economy is showing early signs of recovery as the Central Bank of Nigeria (CBN) forecasts stronger growth and easing inflation in 2026. According to the apex bank, Gross Domestic Product (GDP) is projected to expand by 4.49 per cent, while inflation is expected to moderate to 12.94 per cent. External reserves are also set to rise to $51.04 billion, reflecting the impact of targeted reforms and improved market discipline, alongside higher oil production and fiscal restructuring.
CBN Governor Olayemi Cardoso emphasized that these reforms aim to restore credibility, transparency, and stability to Nigeria’s macroeconomic environment. Speaking at the 59th annual Bankers Dinner, Cardoso noted that consistent policy action has already yielded results, including reduced inflationary pressures and improved investor confidence. “Our economy grew by 4.23 per cent in the second quarter of 2025—the strongest pace in four years—driven by improvements in telecommunications, financial services, and oil production,” he said.
The bank’s outlook is supported by ongoing foreign exchange reforms, stronger oil output, and structural initiatives to diversify Nigeria’s economy. Analysts at Cowry Assets and United Capital Research predict that rising external reserves will provide the CBN with greater flexibility to stabilize the naira and sustain interventionist policies in the foreign exchange market. Additionally, easing lending rates and improved FX liquidity are expected to boost investment and consumption, further supporting growth in 2026.
However, economists caution that while macroeconomic indicators are improving, translating these gains into tangible benefits for citizens remains a challenge. Poverty, unemployment, and infrastructure gaps persist, and experts stress that reforms must be consistent and inclusive. Dr. Baba Musa of the West African Institute for Financial and Economic Management highlighted that long-term success depends on ensuring growth translates into decent jobs, rising incomes, and improved social welfare.
Looking ahead, the CBN remains committed to evidence-based policy and gradual monetary easing to anchor inflation expectations. The bank projects a current account surplus of $18.81 billion in 2026 and expects continued improvements in oil output, diaspora inflows, and non-oil sector performance. While risks such as global economic shocks and fiscal pressures remain, the CBN believes that consistent reforms, stronger reserves, and structural diversification can create a more resilient Nigerian economy for the years ahead.
source: punch