PwC projects Nigeria's GDP growth at 4.3% for 2026

PricewaterhouseCoopers (PwC) has projected Nigeria's real gross domestic product growth at 4.3% for 2026, supported by higher crude oil production and stronger performance in dominant sectors. The consultancy also expects the naira to remain broadly stable, helped by improved external buffers and foreign-exchange market reforms.

Economic outlook and risks

In its latest Economic Outlook released yesterday, PwC said Nigeria's economic outlook remains positive, although the second half of the year will continue to be shaped by domestic and external risks. The report noted that inflation is expected to moderate, but food-price pressures, other supply-side shocks and pre-election spending could create upside risks.

PwC said monetary policy is expected to remain relatively tight, with room for gradual rate reductions if the decline in inflation is sustained. Fiscal pressures may also persist as continued spending needs, the budget deficit, and government financing requirements place demands on available resources.

The report said the central task for Nigeria in H2 2026 is not simply to preserve macroeconomic stability, but to make that stability work more effectively for households and businesses. Progress will depend on lowering essential costs, expanding access to finance, improving infrastructure and productivity, and converting stronger investor interest into productive investment and jobs.

H1 performance mixed

PwC said economic activity remained resilient in the first half of the year, but the pattern of growth was uneven. GDP growth in Q1 was driven by stronger activity in ICT, Finance & Insurance, Construction and Agriculture.

The Purchasing Managers' Index weakened during the second quarter, recovering only marginally to 50.1 in June. Agriculture remained in expansion, while industry, services and new orders were below the 50-point threshold. Seventeen of the 36 subsectors tracked were in contraction, highlighting continued pressure on parts of the real economy.

FX, capital inflows and revenues

Foreign exchange conditions strengthened, with improved official-market liquidity and larger external buffers supporting naira stability. Capital importation rose to $10.37 billion in Q1 2026, but foreign portfolio investment accounted for $9.86 billion, or 95.1% of total inflows, while foreign direct investment accounted for only 1.3%. PwC said this underscores the need to convert improved investor confidence into longer-term investment in productive assets, businesses and infrastructure.

Fiscal revenue also strengthened, though execution pressures remain. Total distributable FAAC revenue rose to N2.55 trillion in June, supported by stronger statutory revenue and VAT collections. But revenue performance against budget targets has been uneven, while continued spending requirements, government borrowing and overlapping budget cycles may constrain fiscal flexibility and capital-project delivery.

For households, improvements in headline inflation have provided limited relief. Food inflation rose to 17.52% in June, and the cost of a healthy diet reached N1,589 per adult per day in April. Buying conditions for consumer durables, vehicles and property remained weak, reflecting the continued pressure of essential spending on household budgets.

The report was co-authored by Partner and Chief Economist at Strategy& West Africa, Olusegun Zaccheaus; Partner and Clients & Market Leader, West Market, Pedro Omontuemhen; Director Akolawole Odunlami; and Manager/Lead Economist Adesola Borokini, PhD.

For the naira, the outlook points to stability for now, but exposure to oil price swings, capital flow shifts and domestic FX demand remains. For Nigerian businesses and households, the report signals that despite macroeconomic gains, high food costs and weak purchasing conditions are likely to persist until the broader reform dividend translates into stronger incomes and cheaper essentials.