LAGOS, June 26 – S&P Global Ratings has raised its forecast for Nigeria’s average inflation rate in 2026 to 16.9%, up from its previous estimate of 15.0%, citing stronger-than-expected transmission of higher global oil prices into domestic energy costs.
The revised outlook was published in the agency’s latest report, Economic Outlook Emerging Markets Q3 2026: Inflationary Pressures Will Persist, which highlighted rising inflationary pressures across emerging markets in Europe, the Middle East and Africa.
According to S&P Global, Nigeria recorded the largest upward revision to inflation among the key emerging market economies covered in the region.
The ratings agency said higher energy prices are expected to continue feeding into broader consumer inflation, while food prices could also rise as increased transportation and fertilizer costs pass through to agricultural production and distribution.
“Compared with our March baseline, we have raised our inflation projections and lowered our growth forecasts for most emerging market economies in Europe, the Middle East and Africa,” the report stated.
S&P Global noted that energy inflation has accelerated across the region, particularly in Nigeria and Türkiye, with higher oil prices exerting greater pressure on domestic energy markets than previously anticipated.
The agency also revised Nigeria’s economic growth outlook lower.
It reduced its forecast for gross domestic product growth in 2026 by 30 basis points to 3.7%, while its projection for 2027 was lowered by the same margin to 3.5%.
According to S&P Global, the weaker growth outlook reflects the impact of persistent inflation on household consumption, which remains a key driver of Nigeria’s economy.
Despite the downward revisions, the agency maintained that Nigeria’s economy is expected to remain resilient, supported by ongoing economic activity and structural reforms.
The report suggests that inflation will remain one of the country’s principal macroeconomic challenges, with higher living costs expected to weigh on consumer spending and overall economic expansion over the medium term.
