CBN, Economists Project Faster Growth, Lower Inflation in 2026

The Central Bank of Nigeria and leading economists have projected stronger economic growth and lower inflation in 2026, citing improved macroeconomic fundamentals and reform impacts following two years of policy adjustments.

The Numbers

Central Bank Deputy Governor for Economic Policy, Dr Muhammad Abdullahi, announced that real GDP growth is projected at 4.49 per cent in 2026, up from an estimated 3.2 per cent in 2025. He added that inflation is expected to moderate to 12.94 per cent by year-end, reflecting easing pressures from food prices, exchange rate stability, and successful monetary policy tightening.

According to Abdullahi, the outlook is supported by non-oil sector expansion, particularly in agriculture, telecommunications, and financial services. Improved crude oil output averaging 1.6 million barrels per day, rising private investment following banking sector recapitalisation, and a more stable macroeconomic environment all contribute to the positive forecast.

External Reserves

External reserves are projected to exceed 50 billion dollars in 2026, representing the highest level since 2013. Foreign exchange conditions are expected to remain broadly stable due to ongoing FX reforms, higher oil receipts projected at 75 dollars per barrel, record diaspora remittances exceeding 25 billion dollars annually, and stronger investor confidence reflected in recent portfolio inflows.

Expert Perspective

Keynote speaker Professor Biodun Adedipe, Chief Consultant of B. Adedipe Associates Limited, described 2026 as a stabilisation year marked by exchange rate stability, declining inflation, rising reserves and strong stock market performance that could see the All-Share Index cross the 120,000 mark.

Adedipe said Nigerians were already feeling reform impacts, noting easing prices of some staple foods including rice, tomatoes, and vegetable oils at major markets in Lagos, Kano, and Abuja. He called for sustained policies to boost domestic production, particularly in agriculture, to further reduce inflation and insulate the economy from global food price shocks.

Sectoral Outlook

Agriculture is projected to grow by 3.8 per cent, driven by dry season farming, improved seed varieties, and federal government support for smallholder farmers through the National Agricultural Growth Scheme.

Telecommunications and digital economy sectors are expected to expand by 8.5 per cent as 5G rollout accelerates and broadband penetration reaches 50 per cent.

Manufacturing is forecast to grow by 4.2 per cent, supported by improved power supply, lower input costs from exchange rate stability, and increasing local content in consumer goods production.

What This Means for Nigerians

The projections suggest that after several challenging years characterised by high inflation and currency volatility, Nigeria’s economy is finding firmer footing. For businesses and households, lower inflation and greater stability could translate into improved purchasing power, more predictable planning environments, and renewed investor confidence that creates jobs.

Risks to Watch

Economists caution that risks remain, including potential global oil price volatility, climate-related agricultural disruptions, and the pace of implementation of structural reforms across key sectors. However, they note that the overall trajectory points toward gradual but sustained improvement.

The Central Bank has indicated it will maintain a tight monetary policy stance until inflation is firmly on a downward path, with the next Monetary Policy Committee meeting scheduled for March 2026.