April 06, (THEWILL) — Nigeria’s economy is expected to sustain positive growth in the second quarter of 2026, but expansion may moderate as downside risks intensify, the Centre for the Promotion of Private Enterprise (CPPE) has cautioned.
In its latest outlook, the think tank highlighted rising global crude oil prices driven by the ongoing Middle East conflict as a key threat to Nigeria’s fragile disinflation trend. According to CPPE Director, Muda Yusuf, the pass-through effect of higher energy costs could undermine recent gains in price stability.
“The cost pass-through effect poses a significant threat to the fragile disinflation process, potentially reversing recent gains, weakening real incomes, and worsening cost-of-living pressures for households and businesses”, he said.
While the CPPE projects relative exchange rate stability in the second quarter, supported by improved foreign reserves and liquidity, it warned that volatility risks persist. The report also pointed to an increasing likelihood of stagflation, as persistent cost pressures collide with weak growth momentum.
On monetary policy, Yusuf stressed that current inflationary trends are largely structural and cost-driven, rather than a result of excess demand, suggesting limited impact from conventional tightening measures.
The CPPE also raised concerns about the implementation of the proposed ₦68 trillion 2026 budget, citing weak revenue performance, delays in capital releases, and rising political influence on spending decisions.
It warned that intensifying political pressures could erode fiscal discipline, with a shift toward recurrent and politically motivated expenditures.
The organisation urged businesses to prioritise resilience by cutting costs, adopting alternative energy, and strengthening foreign exchange risk management, while calling on policymakers to act decisively to stabilise the economy and protect vulnerable groups.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
