NESG says inflation will drop to 24.7%, FX rates to stabilise at N1,300/$ in 2025

• The Nigerian Economic Summit Group has projected that the inflation rate will drop to 24.7 per cent and the exchange rate to stabilise at N1,300/$ in 2025
• It said the projection is based on anticipated improvements and coordination in fiscal and monetary policies
• NESG said the exchange rate stability will be driven by favourable economic conditions

The Nigerian Economic Summit Group (NESG) has projected that inflation will drop to 24.7 per cent and the foreign exchange rate to stabilise at an average of N1,300/$ in 2025.

NESG, in its recently released 2025 Macroeconomic Outlook Report with the theme, ‘Stabilisation in Transition: Rethinking Reform Strategies for 2025 and Beyond,’ said the projection is based on anticipated improvements and coordination in the fiscal and monetary policies.

The group said policymakers aim to curb inflationary pressures by aligning government spending with targeted monetary interventions.

It said key measures responsible for the projected improvement include disciplined government spending, strategic interventions in critical economic sectors, and measures to mitigate the effects of global economic uncertainties on Nigeria’s domestic economy.

The NESG said that “inflation is projected to decline to 24.7 per cent, signaling an improvement in the country’s macroeconomic stability.  

“The exchange rate is projected to strengthen, averaging N1300/US$1 in 2025 under the ideal stabilisation pathway.  

“The effective coordination of fiscal policies with monetary policy measures will drive this anticipated reduction in the inflation rate.”

FX rate stability to be driven by favourable economic conditions

The NESG said the improvement and stability of the exchange rate will be driven by a combination of projected favourable economic conditions.

These conditions include higher crude oil sales, projected to bolster foreign exchange earnings due to a stabilisation of global demand for crude oil, increased production, and exports from Nigeria.

Others are increased oil refining in the country, expected to reduce import dependency for refined petroleum products, and expanded agricultural production, driven by government support and private sector investments, which will boost Nigeria’s export portfolio and contribute to forex inflows.

The NESG said, “This anticipated improvement reflects combined impact of higher crude oil sales, expanded manufacturing output due to resuscitation of oil refining sub-sector, and increased agricultural production, all contributing to enhanced foreign exchange (forex) earnings.”

Inflation rate reached 34.80 per cent in December

Nigeria’s inflation rate increased to 34.80 per cent in December 2024 from 34.60 per cent in November 2024.

Despite the hike, President Bola Tinubu vowed to reduce the inflation rate to 15 per cent in 2025, through economic reforms.

Experts project naira, FX stability, MPR, inflation decline, fuel price slash, others in 2025

Meanwhile, TheRadar earlier reported that experts projected some of the economic realities that will shape 2025.

These include stability of the naira and the foreign exchange (forex) market, decline in the Monetary Policy Rate (MPR) and inflation rate, reduction in fuel price, and growth of other economic indicators.