Fitch revises Nigeria’s outlook to positive, affirms ‘B’ rating
By Emma Ujah, Abuja Bureau Chief
Fitch Ratings has revised Nigeria’s Long-Term Issuer Default Ratings outlook from Stable to Positive, attributing this change to ongoing economic reforms and an increase in foreign exchange reserves.
The global rating agency also highlighted easing inflationary pressures and a more favorable economic growth forecast, with the World Bank projecting an expansion of 4.3 percent for this year. Fitch affirmed Nigeria’s credit rating at “B.”
Key factors in this positive reassessment include enhanced exchange rate flexibility, declining inflation, and a quicker-than-expected rise in foreign exchange reserves. Nigeria’s gross external reserves reached $55 billion last month, a significant increase from $32 billion in mid-April 2024.
Fitch’s decision reflects its increasing confidence in the government’s ability to maintain reforms that strengthen Nigeria’s policy framework and promote macroeconomic stability. The formalization of foreign exchange transactions, inflows from portfolio investments, rising export earnings, and remittances from the Nigerian diaspora all contributed to the new rating.
The anticipated economic growth is expected to be driven primarily by non-oil sectors. Fitch noted that Nigeria’s crude oil production has consistently met the Organization of the Petroleum Exporting Countries’ target of 1.5 million barrels per day since May 2026. Furthermore, an increase in domestic refining capacity is expected to reduce imports of refined petroleum products, thereby decreasing the demand for foreign exchange.
Fitch projects average inflation to decline to 15.4 percent by 2026, less than half of the current level for 2024. The agency expressed optimism that ongoing tax reforms could enhance non-oil revenue generation and strengthen the government’s financial position.
In response to this development, Finance Minister and Coordinating Minister of the Economy, Mr. Oyedele, stated that the positive outlook indicates a potential upgrade in Nigeria’s rating if current trends continue. He characterized the decision as further validation that the administration’s economic reforms are yielding positive results.
Mr. Oyedele highlighted that all three major international rating agencies have recently issued positive ratings for Nigeria in 2026.
