Fitch Moves Nigeria to Positive Outlook as Reserves Hit $54.9bn

Fitch Ratings has raised Nigeria's credit outlook to positive, opening the door to a possible upgrade. The rating agency announced the decision on 9 October, crediting the reforms President Bola Tinubu launched after taking office in 2023.

Those reforms, the removal of the fuel subsidy and the unification of the exchange rate, were called the boldest economic decisions in a generation at the time. Fitch now says they are delivering results, and that it is confident the momentum "will not be disrupted by upcoming elections".

Reserves and the naira

The clearest gain is the rebuilding of foreign reserves. They have climbed from $32 billion in April 2024 to $54.9 billion in September 2026, a rise of more than 70%. The reserves the Central Bank can actually use have grown almost ninefold, from about $4 billion at the end of 2023 to $34.8 billion at the end of 2025.

Fitch links the build-up to more dollars flowing through official channels: export earnings, foreign investment and remittances from Nigerians abroad. The agency expects reserves to cover more than six months of external payments by the end of the year, and expects the naira to hold steady.

For the trader in Onitsha importing goods, the manufacturer in Kano buying equipment or the family in Lagos paying school fees abroad, that stability makes planning possible again.

Inflation, oil and growth

Prices are following the same path. Fitch expects average inflation of 15.4% this year, less than half the 2024 level, with further declines as the Central Bank's policies take hold.

The energy sector is rebounding too. Crude oil production rose 10% in the second quarter and has met Nigeria's OPEC target since May, at 1.52 million barrels a day. The ramp-up of the Dangote refinery and the rehabilitation of other facilities have cut fuel imports, saving foreign currency.

Fitch expects the economy to grow 4.3% in 2026 and more than 4% in each of the following two years, led by sectors outside oil.

Banks and public debt

Nigerian banks, which almost all met the government's new capital requirements this year, now carry strong balance sheets, with many posting capital ratios above 20%. That leaves them able to finance businesses and jobs.

Public finances are steadier as well. Public debt is expected to fall from 40% of GDP in 2024 to around 32% over 2026 to 2028, against an average of 56% for countries with the same rating. On that measure, Nigeria sits among the least indebted economies in its category.

Fitch named three triggers for an upgrade: continued disinflation, stronger reserves and higher non-oil revenue. The government's tax reform is expected to lift non-oil revenue to 7.5% of GDP, two-thirds of public income.

For a country that faced a currency crisis just three years ago, the verdict marks a turning point, and one that could lower Nigeria's borrowing costs if it converts into an upgrade.