Nigeria economy recovery gains momentum as the CBN projects stronger growth, lower inflation and higher reserves for 2026

Nigeria’s economy is showing early and encouraging signs of stabilisation, with the Central Bank of Nigeria projecting stronger growth, easing inflation and rising external reserves in 2026.

Also read: Nigeria’s economy shows fragile stabilisation, ICAN warns

The outlook reflects growing confidence that recent reforms are beginning to recalibrate the economy and restore macroeconomic balance.

In its latest macroeconomic projections, the apex bank forecast that Gross Domestic Product would grow by 4.49 per cent in 2026, while average inflation is expected to moderate to 12.94 per cent.

External reserves are also projected to rise to 51.04 billion dollars, supported by improved oil production, stronger capital inflows and sustained reforms in the foreign exchange market.

The CBN said the Nigeria Economy Recovery is being driven by structural and monetary reforms aimed at restoring credibility, strengthening market discipline and improving policy coordination.

According to the bank, easing monetary conditions are also expected to reduce lending costs, thereby supporting output growth and private sector activity.

Reflecting on recent progress, CBN Governor Olayemi Cardoso said the institution had focused deliberately on restoring transparency, consistency and alignment in monetary policy.

He noted that reforms had helped move the economy from crisis containment to reform led stabilisation, adding that policy actions were being implemented with clarity and discipline.

Cardoso disclosed that Nigeria recorded real GDP growth of 4.23 per cent in the second quarter of 2025, the strongest pace in four years, driven largely by improvements in telecommunications, financial services and oil production.

He also confirmed that inflationary pressures have continued to ease, declining steadily from a peak of 34.6 per cent in late 2024 to 14.50 per cent by November 2025.

According to him, the moderation in inflation is restoring purchasing power and strengthening confidence in policy direction.

He said the CBN’s transition towards an inflation targeting framework was gaining traction, supported by improved data analytics, stronger communication and the end of monetary financing of fiscal deficits.

The bank also projected that Nigeria’s current account surplus would rise to 18.81 billion dollars in 2026, supported by stronger exports, improved remittance flows and better performance in the petroleum sector.

External reserves are expected to increase from 45.01 billion dollars in 2025, giving the CBN greater flexibility to manage foreign exchange stability.

Analysts have echoed this optimism, noting that rising reserves could help sustain relative stability in the naira across official and parallel markets.

They also expect stronger oil receipts and diaspora inflows to continue supporting the Nigeria Economy Recovery.

However, economists caution that stabilisation alone is not enough. The International Monetary Fund has acknowledged Nigeria’s bold fiscal and monetary reforms but warned that poverty and food insecurity remain high, with gains yet to be felt widely by citizens.

CBN officials have also admitted that more work is required to translate macroeconomic stability into tangible improvements in living standards.

They stressed the need for sustained reforms, improved productivity and inclusive growth that delivers jobs and higher incomes.

Experts believe that the true test of the Nigeria Economy Recovery lies in whether growth becomes durable and inclusive.

Also read: Nigeria economy shows strong outlook for 2026 despite risks

While risks such as global shocks, fiscal pressures and oil sector disruptions remain, the consensus is that consistent reforms, stronger institutions and diversified growth could place the economy on a more resilient and competitive path.