S&P upgrades Nigeria’s outlook from stable to positive
Agency Report
S&P Global Ratings upgraded Nigeria’s credit outlook from stable to positive on November 14, 2025, while affirming the current long- and short-term sovereign ratings at ‘B-/B’.
This change reflects confidence in Nigeria’s ongoing economic, fiscal, and monetary reforms led by President Bola Tinubu’s administration, which have improved macroeconomic indicators, external position, and growth prospects.
S&P raised growth forecasts to an average of 3.7% from 2025 to 2028, driven by higher oil production and greater private sector confidence, with inflation expected to gradually decline.
The positive outlook signals that Nigeria has shown resilience amid challenges such as low GDP per capita, high debt servicing costs, and inflation above 20% in the near term. Improvements in foreign reserves, a more stable naira exchange rate, and removal from the Financial Action Task Force grey list have bolstered investor confidence and foreign inflows.
Nevertheless, S&P acknowledged that risks remain, including structural economic weaknesses and potential reform implementation risks, which could lead to a revision back to stable if conditions worsen.
In summary, the upgrade to a positive outlook from stable underscores Nigeria’s progress in reform and macroeconomic management while affirming its current rating level that still reflects vulnerability and high risk in the short and medium term.
S&P’s upgrade of Nigeria’s outlook to positive could lower the country’s risk premium, potentially reducing borrowing costs on new domestic and international debt issuances by attracting more investors and tightening bond yields.
This reflects improved perceptions of reform credibility, which historically led to bond spread compression and higher returns for Nigerian sovereign bonds following similar positive signals. However, immediate impacts may be modest given persistent high inflation, tight monetary policy, and elevated benchmark yields around 17-27% on local bonds.
