Making the Gains Count.
Navigating Nigeria's macro shift ahead of 2027. A consolidated review of the global and domestic economy, equities and fixed income — from Afrinvest Research.
July 2026 · Afrinvest Research
Five chapters on the shape of the year ahead.
Executive Summary
The global economy proved resilient in H1:2026, sustained by AI investment, resilient labour markets and robust technology spending — even as renewed geopolitical tensions, supply-chain disruptions and protectionism tempered trade and complicated the disinflation path. The IMF projects global GDP growth of 3.1% in 2026, down from 3.4% in 2025.
Nigeria's reforms have begun to deliver tangible gains. Real GDP accelerated to 3.9% y/y in Q1:2026, supported by banking recapitalisation, the Dangote Refinery ramp-up to 650,000 bpd and cumulative FX and monetary reforms since 2023. Capital importation hit a record $10.4bn, FX reserves reached their strongest level since 2009, and the Naira firmed from ₦1,445.00 to ₦1,374.92/$1.00.
Yet the gains remain fragile. Crop production, trade and livestock — where most Nigerians earn a living — are growing at a 3.0% CAGR, below the c.4.0% broad economy. The ₦68.3tn 2026 Appropriation Act passed only in April (the first delay since 2019), 82.3% of 2025 CAPEX was unexecuted as of 9M:2025, debt stock rose to ₦159.3tn, and debt-servicing-to-revenue is estimated to have worsened to 61.2%.
Looking ahead to H2:2026, we forecast real GDP growth of 4.2%, average inflation of 15.8% and the Naira to average ₦1,381.73/$1.00, closing the year at ₦1,409.93/$1.00. Nigeria must now consolidate its gains through stronger fiscal management, institutional reform and private-sector-led investment to convert stability into durable, inclusive growth.
Softening momentum, regional divergence.
The IMF nudged 2025 growth to 3.4% but sees 2026 cooling to 3.1%, with softer expansion across advanced economies while emerging markets remain the primary engine of growth. Renewed Middle East tensions stalled disinflation, but a positive Chinese manufacturing outrun could smooth the descent.
- Merchandise trade growth (base)1.9%
- G20 merchandise trade · Q1+5.3%
- Global inflation · 2026E4.1%
- Strait of Hormuz · crude share>30%
- Standout equity sectorSemiconductors
Commodities led H1:2026 performance.
H1:26 return · data as of 30 Jun 2026.
- Gasoline+0.0%
- Brent crude+0.0%
- Wheat+0.0%
- Copper+0.0%
- Maize+0.0%
- Gold0.0%
- Silver0.0%
- Cocoa0.0%
Spending on semiconductors, data centres and cloud continues to accelerate — a genuine capex cycle, though its benefits favour economies with stronger digital infrastructure.
Trade fragmentation and supply-chain realignment are reshaping investment flows, widening the gap between economic winners and laggards across regions and sectors.
In a higher-rate world, markets reward transparent governance, sustainable finances and resilient earnings — and penalise excessive leverage and opaque fiscal positions.
Nigeria's engine revving faster.
Q1:2026 real GDP growth, %
Nigeria sits mid-pack among African peers — ahead of South Africa but trailing Ghana, Egypt and Kenya on Q1:2026 growth.
- South Africa+0.0%
- Nigeria+0.0%
- Kenya+0.0%
- Egypt+0.0%
- Ghana+0.0%
Sector CAGR vs share of employment
Higher-productivity sectors grow twice as fast but absorb far less labour — the core of the inclusivity gap.
Nigeria's first S&P upgrade in 14 years, following Fitch and Moody's in 2025.
Removed from the EU's high-risk jurisdictions list, effective January 2026.
Upgraded back to Frontier Market status, implementation scheduled September 2026.
Financial-sector recapitalisation, the Dangote Refinery ramp-up to 650,000 bpd and cumulative FX and monetary reforms since 2023 are broadening the base — evidenced by credit upgrades and watchlist exits.
Crop production, trade and livestock — where most Nigerians earn — grow at 3.0% CAGR, in line with population but below the c.4.0% broad economy, so gains are not yet felt at the grassroots.
The ₦68.3tn 2026 Appropriation Act passed only in April, the first delay since 2019. 82.3% of 2025 CAPEX was unexecuted as of 9M:2025, and debt stock rose to ₦159.3tn at end-2025.
ASI above the historic 250,000 mark.
Strong bullish momentum defined H1:2026, underpinned by robust corporate earnings, improving macro stability and easing inflation expectations. Completed banking recapitalisation, attractive dividend yields and supportive corporate actions sustained demand — though the delayed FTSE Russell reinclusion and profit-taking moderated gains late in H1.
NGX All-Share Index return, revised up on stronger-than-expected H1, resilient earnings and anticipated large-ticket listings.
- Oil & Gas+0.0%
- Industrial Goods+0.0%
- AFR-ICT+0.0%
- Faster-than-expected disinflation
- Stronger FX inflows and reserves
- Accelerated structural reforms
- Confirmed FTSE Russell reinclusion
- Renewed inflationary pressures
- Exchange-rate volatility
- Elevated fixed-income yields
- Weaker foreign participation & FTSE delay
Yields climb as inflation flickers and CBN eases.
Net liquidity turns negative in H2 as paper supply outweighs maturities. Hover any month to inspect all three series.
Q1 was swayed by the bulls' disinflation narrative; Q2 saw inflation concerns and aggressive paper supply push yields higher. We expect policy to stay muted ahead of the polls.
First tranche accessed of the First Abu Dhabi Bank TRS facility.
A broadly stable exchange rate around ₦1,380/$1.00 supports the case for an unchanged MPR through the remainder of 2026.
Consolidate the gains. Convert stability into inclusive growth.
If reform discipline holds — stronger fiscal management, institutional reform, private sector-led investment, infrastructure delivery and targeted social protection — Nigeria can convert today's macro stability into durable, inclusive growth ahead of the 2027 elections.