Nigeria Macro Snapshot May 2026

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A comprehensive May 2026 snapshot of Nigeria's economy using the latest available NBS, CBN, IMF and World Bank data on GDP, inflation, policy rates, FX reserves, trade, fiscal position and household p

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Summary

Nigeria enters May 2026 with a macroeconomic story that is simultaneously improving and fragile. The economy is growing faster than it did in 2024, inflation is far lower than the peaks of 2024–2025, and the naira has appreciated year-to-date against the US dollar. Yet the recovery is uneven, and fresh headwinds—especially from the Middle East conflict and domestic fiscal pressures—are testing the durability of reform gains. The latest official national accounts from the National Bureau of Statistics (NBS) show real GDP growth of 4.07% year-on-year in Q4 2025 and 3.87% for full-year 2025 [^1^]. The International Monetary Fund (IMF), in its April 2026 World Economic Outlook, projects Nigeria's 2026 real GDP growth at 4.1%, down from a 4.4% forecast in January, citing war-related fuel and shipping costs [^2^]. The World Bank's April 2026 Africa Economic Update similarly downgraded its 2026 outlook to 4.1% and expects inflation to moderate from an average of 23% in 2025 to 14.9% in 2026 [^3^]. Inflation has moderated substantially under the rebased Consumer Price Index (CPI), but it has not disappeared. The NBS March 2026 CPI report—the latest available as of early May—shows headline inflation at 15.38% year-on-year, up from 15.06% in February 2026 [^4^]. The month-on-month headline rate surged to 4.18%, a sharp reminder that annual disinflation can coexist with acute monthly price pressure [^4^]. Food inflation stood at 14.31% year-on-year, while core inflation reached 16.21% [^4^]. The Central Bank of Nigeria (CBN) cut the Monetary Policy Rate (MPR) by 50 basis points to 26.5% at its February 23–24, 2026 meeting, retaining the Cash Reserve Requirement (CRR) at 45.0% for deposit money banks [^5^]. The next MPC meeting is scheduled for May 19–20, 2026; as of this report's publication date, the outcome had not yet been announced. Externally, gross official reserves declined from a 13-year high of $50.45 billion in February 2026 to approximately $48.36 billion by Apr

Key Findings

Growth momentum is positive but downgraded. Real GDP grew 4.07% y/y in Q4 2025 and 3.87% for full-year 2025. Both the IMF and World Bank now project 4.1% growth for 2026, down from 4.4% earlier forecasts [^1^][^2^][^3^].
NBS Q1 2026 GDP data had not been released as of early May 2026. Private-sector estimates place Q1 2026 growth near 3.75–3.99% y/y, but official confirmation is pending [^12^][^13^].
Inflation disinflation stalled in March 2026. Headline CPI rose to 15.38% y/y (from 15.06% in February), ending a 12-month streak of year-on-year declines [^4^]. Month-on-month inflation jumped to 4.18% from 2.01%.
Food inflation remains the dominant household stress. Food inflation was 14.31% y/y in March 2026, with the food and non-alcoholic beverages division contributing 5.55 percentage points to headline inflation [^4^].
Core inflation is rising faster than food inflation on a monthly basis. Core inflation surged 4.03% month-on-month in March 2026, up from 0.89% in February, signaling broadening price pressures [^14^].
CBN delivered cautious easing in February 2026. The MPC cut the MPR to 26.5% but retained a tight liquidity framework (CRR at 45%, asymmetric corridor at +50/–450 bps) [^5^].
The May 19–20, 2026 MPC meeting outcome was pending at the time of writing. Analysts are divided on whether the CBN will hold or cut further amid renewed inflationary pressure.
External reserves have retreated from February peaks. Gross reserves fell from $50.45 billion on February 16, 2026, to approximately $48.36–48.54 billion by late April [^6^][^7^].
The naira has appreciated year-to-date but faces thin liquidity. The NFEM rate strengthened from about NGN 1,430.85/US$ at the start of 2026 to NGN 1,374.94/US$ on April 30, yet April 30 recorded zero turnover at the NFEM [^6^][^8^].
The current account remains in surplus, but risks are building. The surplus was $3.73 billion in Q1 2025; elevated oil prices help, while higher fuel and shipping costs hurt the non-oil economy [^9^][^2^].
Fiscal deficits remain very large. The 2026 budget proposes a ₦23.85 trillion deficit (4.28% of GDP), with debt service consuming roughly 45% of projected federal revenue [^10^].
Capital budget execution is chronically weak. By mid-2025, only ₦393.86 billion had been released for 2025 capital spending, and overlapping budget cycles have become normalised [^15^].
New tax laws took effect January 1, 2026. The reforms consolidated over 60 taxes into fewer than 10 statutes and reportedly expanded registered taxpayers from about 10 million to over 100 million [^16^].
Labor-market data is stale and contested. The last NBS Labour Force Survey (Q2 2024) reported unemployment at 4.3% under a new methodology that counts anyone working at least one hour per week as employed; 93% of jobs are informal [^17^][^18^].
The April 2026 PMI slipped into contraction. The CBN composite PMI fell to 49.4, ending 16 consecutive months of expansion, with industry at 49.5 and services at 48.8 [^11^].

Key Findings at a Glance

Indicator	Latest Data	Direction	Nigerian Impact
Real GDP Growth (Q4 2025)	4.07% y/y [^1^]	Stable	Positive headline, but not yet broad-based welfare gains
2026 GDP Growth (IMF/WB proj.)	4.1% [^2^][^3^]	Downgraded	Moderate expansion; insufficient for rapid job creation
Headline Inflation (Mar 2026)	15.38% y/y [^4^]	Rising	First y/y increase in 12 months; monthly pressure acute
Food Inflation (Mar 2026)	14.31% y/y [^4^]	Elevated	Staples still squeezing household budgets nationwide
Core Inflation (Mar 2026)	16.21% y/y [^14^]	Rising	Non-food price pressures broadening
Monetary Policy Rate	26.5% [^5^]	Eased (cautious)	Still very high for borrowers and SMEs
Gross External Reserves	~$48.36bn (Apr 29) [^7^]	Declining from peak	Comfortable buffer, but drawdown merits watching
NFEM Exchange Rate	NGN 1,374.94/$ (Apr 30) [^6^]	Appreciated YTD	Improved stability, but thin liquidity on some days
2026 Budget Deficit	₦23.85tn (4.28% of GDP) [^10^]	Wide	Crowds out capital and social spending
Debt Service / Revenue	~45% [^10^]	High	Nearly half of every naira of revenue goes to debt
Composite PMI (Apr 2026)	49.4 [^11^]	Contraction	First decline in 16 months; demand weakening
Unemployment (Q2 2024, new method)	4.3% [^17^]	Stale / contested	Methodological change masks underlying vulnerability
Informal Employment	~93% [^18^]	Persistent	Majority of workers lack social protection and stable pay

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