Moody’s on Friday revised Nigeria’s outlook to “positive” from “stable”, citing the country’s improved ability to withstand external shocks due to its increased foreign exchange reserves and stronger-than-expected economic growth.
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Africa’s third-largest economy, a major oil producer, has benefitted from a surge in crude prices due to the Middle East conflict and a ramp-up in refined petroleum product exports, boosting the country’s current account surplus.
Moody’s said it expects the West African nation’s surplus “to remain sizeable even under materially lower oil prices.”
The World Bank has projected Nigeria’s economic expansion at about 4.2% in 2026, and has said stronger oil revenue, fiscal discipline and tight monetary policy could help strengthen macroeconomic stability and contain inflation.
Moody’s affirmed the country’s ratings at “B3” as it reflects fiscal pressures arising from limited revenue-generation capacity and weak debt affordability, notwithstanding a moderate debt burden.
Peer S&P Global Ratings in May upgraded Nigeria’s sovereign rating to “B” from “B-“, citing sustained structural reforms and improving credit worthiness, while a month earlier, Fitch affirmed Nigeria’s rating at “B” with a “stable outlook”.