Hope is rising that Nigeria's macroeconomic environment will soon experience a positive turnaround, as data shows a shift from intense adjustment in 2024 toward gradual stabilisation in 2025. The Nigerian Economic Summit Group (NESG) released its Macroeconomic Conditions Monitor, indicating that structural reforms are beginning to moderate systemic imbalances.
Nigeria faced one of its worst economic pressures in 2024 following reforms by the present administration, including fuel subsidy removal, exchange rate liberalisation, and monetary policy tightening. These measures pushed the economy to the brink of collapse, with inflation rising sharply, the local currency depreciating, and the exchange rate soaring, draining citizens' purchasing power and worsening living costs.
However, recent NESG data suggests the reforms are starting to yield results. The report notes that while the direction of change is now positive, the pace remains uneven, and underlying vulnerabilities—particularly in fiscal and real sectors—continue to constrain a full recovery.
2024: Deepest Downturn in Decades
In 2024, the Macroeconomic Condition Index (MCI) fell to -3.0 points, its lowest level in decades, underscoring the cumulative impact of persistent inflationary pressures, mounting fiscal stress, and sustained exchange rate depreciation. The deterioration was broad-based across key pillars: the Real Sector Index (RSI) stood at -3.8 points, the Fiscal Sector Index (FSI) at -6.8 points, and the External Sector Index (ESI) at -1.7 points. Only the Monetary and Financial Sector Index (MSI) remained stable at +0.4 points.
“The broad deterioration highlights reform-induced adjustment, exposing deep structural weaknesses, pushing macroeconomic conditions to their weakest point in recent history,” the report stated.
2025: Gradual Improvement
Data for 2025 indicates a clear but measured improvement, with the MCI moderating from -3.0 points in 2024 to -2.0 points in 2025. Quarterly progress was steady: from -2.9 points in Q1-2025, -2.7 points in Q2-2025, -2.3 points in Q3-2025, to -2.0 points in Q4-2025.
“This trajectory confirms that macroeconomic pressures are easing, but at a gradual pace,” the report said.
External Sector Leads Recovery
The improvement in 2025 was largely driven by the external sector. The External Sector Stability Index (ESI) showed the most significant turnaround, from -1.7 points in 2024 to positive territory by Q3-2025 at +0.3 points, strengthening further to +0.9 points in Q4-2025. This reflects exchange rate stability and improved capital flows.
Persistent Challenges
Despite overall improvement, the report highlights ongoing constraints. The Real Sector Index (RSI) improved but remained negative, moving from -3.8 to -2.2 points, indicating persistent inflation and productivity challenges. The Fiscal Stability Index (FSI) sank further into negative territory, from -6.8 to -7.1 points, underscoring unresolved debt and revenue constraints.
The report concluded that macroeconomic conditions are stabilising, but sustaining progress will depend on policy consistency and effective implementation.
