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The International Monetary Fund (IMF) has warned that Nigerians will face higher prices for essential goods in 2026, a trend that could worsen poverty and food insecurity despite recent improvements in macroeconomic stability.
The projection was contained in the IMF’s July 2026 World Economic Outlook Update, which noted that Nigeria’s outlook is supported by stability and favourable trade terms, but inflationary pressures remain a concern.
“Nigeria is supported by improved macroeconomic stability and favourable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity,” the IMF stated.
The Fund attributed the rise to the global energy crisis, which has driven inflation higher worldwide, particularly in energy-intensive economies. Global headline inflation is projected to rise from 4.1% in 2025 to 4.7% in 2026, before easing to 3.9% in 2027.
The IMF revised its April forecast upward by 0.3 percentage points for 2026 and 0.2 points for 2027, citing higher energy and food costs.
It added that inflationary pressures will vary across countries depending on exchange rates, labour markets, and local economic conditions.
Globally, risks remain tilted to the downside. The IMF warned that renewed geopolitical tensions in the Middle East could trigger commodity price spikes, supply shortages, and exchange rate pressures.
On the upside, smoother reopening of the Strait of Hormuz and lower commodity prices could improve growth prospects.
The Fund also highlighted artificial intelligence (AI) as a potential driver of stronger activity, though it cautioned against excessive optimism that could fuel financial risks.
To strengthen resilience, the IMF urged Nigeria and other countries to rebuild fiscal buffers, invest in infrastructure, education, renewable energy, and digital technology, while expanding social protection programmes to shield vulnerable populations from rising costs
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