By Afolabi Samuel Odunayo
On Tuesday, July 16, the International Monetary Fund (IMF) slashed its forecast for Nigeria’s economic growth in 2024 to 3.1 percent, down from the previous estimate of 3.3 percent.
This adjustment is detailed in the newly released July 2024 World Economic Outlook report.
According to the IMF, the reductions were attributed to weaker-than-expected economic performance in the first quarter of 2024.
The Nigeria’s Gross Domestic Product (GDP) growth fell to 2.98 percent in Q1 2024, a decrease from 3.46 percent in the fourth quarter of 2023.
On a global scale, the IMF’s report highlights broader global economic challenges, noting that global growth is projected to align with the April 2024 forecast, at 3.2 percent in 2024 and 3.3 percent in 2025, respectively.
The institution confirmed that persistent services price inflation is complicating efforts to stabilize monetary policy, potentially leading to prolonged higher interest rates amidst rising trade tensions and policy uncertainty.
Recall that the National Bureau of Statistics (NBS) had also reported that inflation reached 34.19 percent in June 2024, an increase from 33.95 percent in May 2024.
The Bureau stated that the year-on-year headline inflation rate in June 2024 was 11.40 percentage points higher compared to June 2023.
They further described that the month-on-month basis was 2.31 percent in June 2024, which was slightly higher than the 2.14 percent recorded in May 2024.
This indicates a faster rate of increase in the average price level for June compared to May
Despite this recent revision, the IMF has maintained its forecast for Nigeria’s economic growth in 2025 at 3.0 percent.
