The International Monetary Fund (IMF) has revised its forecast for Nigeria’s economic growth in 2024, lowering it to 3.1 percent from the previous 3.3 percent projected in April. This reduction represents a 0.2 percentage point decrease from the earlier forecast.
In its July 2024 World Economic Outlook released on Tuesday, the IMF attributed the downgrade to weaker-than-expected economic activity in the first quarter of the year. However, the IMF maintained its 3.0 percent growth forecast for Nigeria in 2025.
### Nigeria and Sub-Saharan Africa
The IMF also revised its economic growth forecast for sub-Saharan Africa in 2024, reducing it to 3.7 percent from the April projection of 3.8 percent. “The forecast for growth in sub-Saharan Africa is revised downward, mainly as a result of a 0.2 percentage point downward revision to the growth outlook in Nigeria amid weaker than expected activity in the first quarter of this year,” the IMF stated.
For 2025, however, the IMF raised its growth forecast for the region to 4.1 percent, up from the previous projection of 4.0 percent.
### Global Projection
The IMF retained its global economic growth forecast at 3.2 percent for 2024 and 3.3 percent for 2025. “Growth is expected to remain stable. At 3.2 percent in 2024 and 3.3 percent in 2025, the forecast for global economic growth is broadly unchanged from that in April,” the IMF reported.
Among advanced economies, growth is anticipated to converge over the coming quarters. In the United States, the IMF revised projected growth downward to 2.6 percent in 2024, which is 0.1 percentage points lower than the April projection, due to a slower-than-expected start to the year. Growth in the U.S. is expected to slow to 1.9 percent in 2025 as the labor market cools and consumption moderates, with fiscal policy starting to tighten gradually. By the end of 2025, growth is expected to align with potential, closing the positive output gap.
### Inflation Forecast
The IMF forecasted that global inflation will continue to decline. “In advanced economies, the revised forecast is for the pace of disinflation to slow in 2024 and 2025,” the IMF said, attributing this to persistent inflation in service prices and higher commodity prices. However, the gradual cooling of labor markets, along with an expected decline in energy prices, should bring headline inflation back to target by the end of 2025.
In emerging markets and developing economies, inflation is expected to remain higher and decline more slowly than in advanced economies. The IMF noted that for the median emerging market and developing economy, inflation is already close to pre-pandemic levels, partly due to falling energy prices.
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