IMF warns higher prices may worsen Nigeria's poverty despite economic stability

The IMF's July 2026 World Economic Outlook Update projects Nigeria's economy to grow by 4.1 percent in 2026 and 4.3 percent in 2027. However, the report highlights that households remain vulnerable to increasing living costs, with higher prices for necessities expected to aggravate poverty and food insecurity. The IMF noted that global headline inflation is projected to increase, and renewed geopolitical tensions, particularly in the Middle East, pose the biggest downside risk to the global economy, potentially leading to commodity price volatility and higher energy and food costs.

The Fund advised governments to avoid broad-based fuel subsidies, tax cuts, and price controls, recommending instead temporary and targeted support for vulnerable households while maintaining policies aimed at restoring price stability. It also urged countries to rebuild fiscal buffers, strengthen tax administration, and expand social protection programs. Nigeria's headline inflation rate recently rose to 15.93 percent in May 2026, marking the third consecutive monthly increase.