The international credit rating agency, Fitch Ratings, has revised Nigeria’s economic outlook from Stable to Positive, citing ongoing economic reforms, stronger foreign exchange reserves, declining inflationary pressures and improved external buffers.
However, the agency affirmed Nigeria’s Long-Term Issuer Default Ratings at ‘B’, indicating that the country’s credit rating remains unchanged despite the improved outlook.
The Federal Government disclosed this in a statement issued on Saturday by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
According to the government, Fitch’s decision, announced on October 9, reflects growing confidence in the sustainability of Nigeria’s economic reform programme and improvements in the country’s macroeconomic conditions.
A Positive Outlook signals that the rating could be upgraded if the current economic trends and reform momentum are sustained.
The development represents another positive assessment of Nigeria’s credit profile in 2026, following S&P Global Ratings’ upgrade of the country’s rating from ‘B-’ to ‘B’ in May and Moody’s Ratings’ revision of Nigeria’s outlook to Positive in August.
The Federal Government said the latest decision reinforced the importance of the reforms introduced under President Bola Tinubu, including the removal of the petrol subsidy, the unification of the foreign exchange market and the implementation of tax reforms.
Fitch identified greater flexibility in the naira exchange rate, disinflation and faster-than-expected accumulation of foreign exchange reserves as major factors behind its decision.
Nigeria’s gross external reserves rose to $54.9bn as of September 25, 2026, from $32bn in mid-April 2024.
The government attributed the improvement to increased formalisation of foreign exchange transactions, strong portfolio inflows, higher export receipts and remittances.
Fitch also noted that improvements in the quality of Nigeria’s reserves had strengthened the country’s capacity to withstand external shocks.
The agency projected that Nigeria would record a current account surplus equivalent to 6.4 per cent of gross domestic product in 2026.
On economic growth, Fitch forecast that Nigeria’s real GDP would expand by 4.3 per cent in 2026, compared with four per cent in 2025.
It also projected that economic growth would remain above four per cent in 2027 and 2028, supported largely by activities outside the oil sector.
The rating agency further noted that Nigeria’s crude oil production had met the Organisation of the Petroleum Exporting Countries’ target of 1.5 million barrels per day since May 2026.
It added that the expansion of domestic refining capacity was helping to reduce imports of refined petroleum products and the associated demand for foreign exchange.
The development comes amid efforts by the Federal Government to strengthen domestic refining, reduce pressure on foreign exchange demand and improve the country’s external position.
On inflation, Fitch projected that average inflation would moderate to 15.4 per cent in 2026, less than half its 2024 level.
Despite the projected decline, the agency identified inflationary pressures as one of the challenges that Nigeria would need to address to consolidate its economic gains.
The rating agency also expects the government’s tax reforms to improve non-oil revenue mobilisation relative to the size of the economy.
Fitch projected that general government debt would average 32 per cent of GDP between 2026 and 2028, significantly below the median of 56 per cent for countries with a ‘B’ rating.
It also recognised the depth of Nigeria’s domestic debt market and the ongoing bank recapitalisation exercise.
According to the government, Fitch noted that many Nigerian banks had capital adequacy ratios above 20 per cent, significantly higher than the applicable regulatory minimums.
The Federal Government said the positive assessment by Fitch, alongside the actions taken by S&P Global Ratings and Moody’s, reflected an increasingly favourable assessment of the country’s economic reform trajectory.
It also noted that FTSE Russell had returned Nigeria to Frontier Market status, effective September 21, 2026.
The government, however, acknowledged that significant challenges remained, including inflation above the levels recorded in comparable economies, low government revenue relative to GDP and high debt-servicing costs.
These challenges, it said, remained central to the administration’s reform programme.
Oyedele said the government remained committed to sustaining the reforms required to strengthen Nigeria’s credit profile and place the country on a path towards investment-grade status over the medium term.
He said the objective was not merely to secure favourable credit ratings but to lower the country’s cost of capital, attract private investment and create jobs.
The minister said the government would continue to pursue a market-reflective and transparent foreign exchange regime while strengthening revenue mobilisation through the implementation of new tax laws and more efficient tax administration.
He added that the administration would prioritise improved fiscal governance, more efficient public spending, transparent debt management and structural reforms to support non-oil growth and economic diversification.
The government also pledged to accelerate efforts to translate macroeconomic stability into broader economic benefits through food security, job creation, human development and support for small businesses.
According to the statement, Fitch indicated that sustained disinflation, continued implementation of reforms, further accumulation of external reserves and stronger non-oil revenue mobilisation could support a future positive rating action.
The Federal Government said it would continue implementing policies aimed at consolidating the improvements identified by the rating agency.
It added that the ultimate objective was to ensure that the gains from economic reforms translated into improved living standards, stronger business activity and greater prosperity for Nigerians.
