Nigeria’s annual-average inflation is projected to decline significantly to 15.6 per cent in 2026 before easing further to 14.7 per cent in 2027, according to the latest economic assessment by the International Monetary Fund.
This expected slowdown marks a noticeable deceleration from the elevated 23.0 per cent average inflation recorded in 2025.
Economic analysts at Coronation Research highlight that key macro stabilisation measures are actively contributing to this cooling trend. Specifically, increased exchange rate stability alongside growing domestic refining capacity is playing central roles in moderating persistent domestic price pressures across supply chains.
Despite this encouraging downward trajectory, persistent risks could temper the speed of relief for businesses and consumers.
In its evaluation of the macroeconomic environment, Coronation Research noted, “Exchange rate stability and increased domestic refining capacity could help moderate price pressures. However, higher energy and fertiliser costs, alongside election-related spending, may slow the pace of disinflation”.
High input expenses and local food insecurity continue to present direct risks to overall household welfare, threatening to constrain how effectively macro disinflation translates into immediate improvements in daily living standards.
Looking ahead, the IMF projects Nigeria’s gross domestic product to grow by 4.2 per cent in 2026 and 4.3 per cent in 2027, driven by continued foreign exchange reforms and strong performance in the non-oil sector.
Analysts from Coronation Asset Management broadly backed these projections, pointing out that their internal estimate for 2027 annual average inflation sits very close to the multilateral lender’s forecast at 14.56 per cent. “While structural headwinds remain, the ongoing economic policy reforms and expanded refining operations provide a strong foundation for steady, long-term price moderation”, an analyst said.
In recent years, Nigeria has grappled with elevated price pressures, fuelled by macroeconomic imbalances, foreign exchange volatility, and external supply chain disruptions. Following a period of aggressive policy interventions, including foreign exchange market adjustments and structural economic reforms aimed at stimulating non-oil production, the focus has shifted toward restoring price stability and stabilising the local currency.
The latest October 2026 World Economic Outlook update by the International Monetary Fund and companion analyses from Coronation Research offer an updated projection on the country’s macroeconomic path.
After headline annual-average inflation climbed to an estimated 23.0 per cent in 2025, persistent tight monetary policy, combined with a gradually stabilising foreign exchange regime, has begun easing price pressures across major consumer categories.
“Increased local refining capacity has further aimed to reduce energy import dependency and temper transportation fuel costs. However, lingering supply risks, higher agricultural input costs, and fiscal pressures continue to pose potential risks to the broader disinflation trend”, the report added.