By Ayomide Otitoju
Global credit ratings agency Moody’s Investors Service has upgraded Nigeria’s sovereign credit rating to “B3” from “Caa1”, citing notable improvements in the country’s external and fiscal positions. The announcement was made on Friday, according to a report by Reuters.
Moody’s also revised Nigeria’s outlook from “positive” to “stable”, reflecting expectations that while the pace of reform-driven gains may slow—particularly if oil prices fall—the improvements will be sustained.
“The recent overhaul of Nigeria’s foreign exchange management framework has markedly improved the balance of payments and bolstered the CBN’s (Central Bank of Nigeria) foreign exchange reserves,” Moody’s stated.
The agency noted a decline in inflationary risks, previously heightened by key policy shifts, and observed early signs of easing in inflation and domestic borrowing costs, boosting investor confidence in the stability of Nigeria’s economic direction.
The rating upgrade follows recent data from the World Bank, which reported that Nigeria’s economy recorded its fastest growth in a decade in 2024. This was attributed to a strong performance in the fourth quarter and an improved fiscal environment. However, the bank cautioned that high inflation remains a persistent economic challenge.
Moody’s emphasized that while further gains may moderate, the structural reforms implemented thus far are unlikely to be reversed, reinforcing Nigeria’s path toward greater macroeconomic stability.
