Global Economy

The global economy navigated a landscape marked by sluggish growth, moderating inflation, diverging monetary policies, trade wars and persistent geopolitical risks. While the United States economy demonstrated resilience despite a first-quarter contraction, the euro area showed nascent signs of stabilisation. In contrast, China continued to struggle with deflation and a weak property sector. Global oil markets remained well-supplied but were sensitive to geopolitical shocks. Trade tensions, particularly between the U.S. and China, weigh heavily on the outlook.

Domestic Economy

Nigeria’s economy grew by 3.13% year-on-year in the first quarter of 2025, based on the newly rebased data, which reflected a slowdown from Q4 2024 but better than the same period last year. While oil production picked up, its overall impact on the economy remained limited. The rebased Inflation also eased to 22.22% in June, helped by a stable currency and falling fuel costs.

Fiscal Policy

Reviewing the 2025 budget performance, the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, disclosed that federal government revenue reached N6.90 trillion in the first quarter of 2025—a 40% year-on-year increase compared to the N5.20 trillion recorded in Q1 2024. This marks a notable improvement in revenue generation and reflects some early momentum in the fiscal year.

However, with a projected annual revenue target of N36.35 trillion, it appears increasingly unlikely that the government will meet its full-year goal.

Monetary Policy

In H1 2025, the Monetary Policy Committee (MPC) broke its long streak of continuous rate hikes since May 2022, adopting a cautious stance in its two meetings in H1 2025. Departing from its previously hawkish stance aimed at curbing inflation and stabilising the foreign exchange market, the Committee opted to keep the Monetary Policy Rate (MPR) and other key monetary parameters unchanged throughout the period. The Committee’s decision was underpinned by several factors including improvements in the foreign exchange market, easing of PMS prices, and the positive balance of payments position.

Financial Markets

The Nigerian equities market opened 2025 with an air of optimism, riding the wave of a strong finish from the previous year. Investors, buoyed by favorable sentiment and an appetite for growth entered the market to position strategically as the market extended its bullish run into the new year. Save for the brief dip in March, the market largely posted strong gains in H1 2025, maintaining a steady upward trajectory that culminated in a historic milestone as the All-Share Index (ASI) soared to an all-time high of 121,257.69 points, marking a solid year-to-date gain of +16.57%.

In the first half of 2025, the Monetary Policy Committee’s (MPC) decision to maintain a cautious stance sent a strong signal to the market that interest rates may have peaked, sparking speculation about potential rate cuts later in the year. This expectation influenced yield movements in the fixed income market, particularly in Q2 2025.

Building on the foundational reforms done in the FX market in 2023 and 2024, the Central Bank of Nigeria (CBN) continued to implement measures to improve transparency and liquidity in the foreign exchange market in 2025. Specifically, the CBN implemented several targeted interventions aimed at stabilising the naira and enhancing the efficiency of the foreign exchange (FX) market. Among these were the introduction of the FX Market Conduct Code to guide market behavior and improve transparency, as well as a directive permitting Bureau de Change (BDC) operators to access up to $25,000 at official rates.

Please follow the link ‘’2025 Economic Outlook – Fragile Gains: Will the Rising Tide Lift All Boats’’ to view the full report.