The Nigeria economy grew 4.43% year on year in the second quarter of 2026, up from 3.89% in the first quarter, according to National Bureau of Statistics (NBS) figures reported by the Rio Times.
What happened
Oil made up just 4.16% of real output in the quarter. Crude production averaged 1.72 million barrels per day, up from 1.68 million. Headline inflation slowed to 15.39% in August from 23.14% a year earlier, and from 15.43% in July, according to the NBS.
The Central Bank of Nigeria (CBN) cut its Monetary Policy Rate to 23% from 26.5% at the Monetary Policy Committee meeting that ended on 22 September. It recalibrated the interest rate corridor to +50 and -300 basis points around the rate and kept the cash reserve requirement for commercial banks at 45%. The bank described the move as an operational realignment rather than a change in stance.
Gross external reserves stood at $55.25 billion on 18 September, the highest level in 18 years and enough to cover about 11.3 months of imports of goods and services, according to the committee. The naira traded at ₦1,331.19 per dollar on 5 October at the central bank’s rate.
Why it matters
The data point to an economy where growth is speeding up, prices are rising more slowly and the external position is stronger. The International Monetary Fund raised its 2026 growth forecast for Nigeria to 4.2% in October, citing a favourable terms-of-trade effect, according to Semafor. The IMF’s full-year projection and the NBS quarterly reading measure different periods, but both point to a firmer picture than a year ago.
Risks remain. The Monetary Policy Committee flagged upside risks to global inflation from supply chain disruptions, elevated crude oil and commodity prices and rising trade fragmentation. Analysts at CardinalStone had also said energy-related pressures were tilting inflation risks upwards. Households are still feeling the effect of high prices, even though the pace of increases has slowed.
What to watch
The next inflation reading will show whether the downward trend continues as the main harvest comes in. The US Federal Reserve meeting on 27 and 28 October could affect capital flows, and the 16 January 2027 elections are the next big test for policy continuity.
Related on Radarr:
- Naira Hits Two-Year High Despite Rate Cut
- IMF Backs Nigeria’s Rate Cuts but Warns Inflation Fight Is Not Over
- IMF Projects Nigeria’s Economy to Grow 4.3% in 2027 as Inflation Slows
Sources: Rio Times, citing the NBS; Blueprint; Business Post; Semafor Africa; Leadership.
