International Monetary Fund (IMF) has raised Nigeria’s economic growth forecast for 2026 to 4.2 per cent from 4.1 per cent, while warning that rising food and energy prices could worsen poverty and food insecurity.
Gatekeepers News reports that Washington-based institution announced the revision in its October 2026 World Economic Outlook report released on Tuesday.
IMF attributed the improved outlook to stronger macroeconomic stability and favourable terms-of-trade effects, which have supported economic activity despite mounting global economic pressures.
However, the fund warned that higher prices for essential goods could worsen living conditions for vulnerable households, highlighting the gap between improvements in economic indicators and the financial realities faced by many Nigerians.
“Higher prices for essentials are expected to further aggravate poverty and food insecurity,” IMF said.
Speaking during a press briefing on the report, Deniz Igan, chief of the IMF Research Department’s World Economic Studies Division, said policymakers needed to balance immediate support for households with the need to maintain fiscal stability over the medium term.
She noted that food and energy costs were rising disproportionately in Nigeria, making it increasingly difficult for vulnerable households to cope with the cost of living.
Igan said Nigeria’s economic growth had remained relatively resilient partly because the country exports energy, but stressed that poverty risks remained high.
She advocated cash transfers and targeted, temporary income support for the most vulnerable households to cushion the effects of rising prices.
The IMF official said such interventions should be designed in line with the government’s medium-term fiscal framework to ensure that assistance to households did not undermine fiscal stability.
The fund also projected Nigeria’s economy to grow by 4.3 per cent in 2027, according to its latest outlook.
Across sub-Saharan Africa, the IMF expects economic growth to remain at 4.5 per cent in 2026, although it warned that the regional figure masks significant differences among countries.
It said growth prospects would depend on fiscal capacity, the implementation of reforms, exposure to commodity prices, climate shocks and access to external financing.
The IMF further projected global inflation to rise to 4.7 per cent in 2026 from 4.1 per cent in 2025, largely due to higher food and energy prices, before easing to 4.1 per cent in 2027.
The latest projections come as Nigeria continues to contend with high living costs, with the IMF stressing the need for policies that protect vulnerable households while sustaining economic stability and growth.
