The International Monetary Fund (IMF) has warned that the rising cost of essential goods could worsen poverty and food insecurity in Nigeria, despite signs of improving macroeconomic stability.
In its July 2026 World Economic Outlook Update, the IMF projected that Nigeria’s economy would grow by 4.1% in 2026 and 4.3% in 2027, but cautioned that soaring prices of food and other basic necessities could reduce the benefits of ongoing economic reforms.
According to the report, while Nigeria has recorded improvements in macroeconomic conditions and favourable trade gains, many households are still struggling with the rising cost of living.
“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 global lender also projected that inflationary pressures would remain elevated, driven largely by rising energy costs and geopolitical tensions.
It forecast that crude oil prices could rise by 32%, natural gas by 22%, fertiliser by 26%, while global food prices may increase by 8% in 2026.
The IMF warned that prolonged disruptions in energy and fertiliser markets could further threaten food security, especially in developing countries across sub-Saharan Africa.
Rather than introducing broad fuel subsidies or price controls, the Fund advised governments to provide temporary, targeted support for vulnerable households while maintaining policies that promote price stability and fiscal discipline.
The organisation also urged countries to strengthen tax administration, improve public spending efficiency and expand well-targeted social protection programmes to cushion the impact of rising living costs.
The warning comes as Nigeria’s headline inflation climbed to 15.93% in May 2026, marking the third consecutive monthly increase, according to the National Bureau of Statistics.
Source: International Monetary Fund (IMF), World Economic Outlook Update; National Bureau of Statistics (NBS)
