Moody’s Revises Nigeria’s Outlook to ‘Positive’

Aug 28 (Reuters) – Moody’s on Friday revised Nigeria’s outlook to “positive” from “stable”, citing the country’s improved ​ability to withstand external shocks due ‌to its increased foreign exchange reserves and stronger-than-expected economic growth.

Africa’s third-largest economy, a major oil producer, ​has benefitted from a surge in ​crude prices due to the Middle ⁠East conflict and a ramp-up in refined ​petroleum product exports, boosting the country’s current ​account surplus.

Moody’s said it expects the West African nation’s surplus “to remain sizeable even under materially lower oil ​prices.”

The World Bank has projected Nigeria’s ​economic expansion at about 4.2% in 2026, and has said stronger ‌oil ⁠revenue, fiscal discipline and tight monetary policy could help strengthen macroeconomic stability and contain inflation.

Moody’s affirmed the country’s ratings at “B3” as ​it reflects ​fiscal pressures ⁠arising from limited revenue-generation capacity and weak debt affordability, notwithstanding a ​moderate debt burden.

Peer S&P Global ​Ratings in ⁠May upgraded Nigeria’s sovereign rating to “B” from “B-“, citing sustained structural reforms and improving credit worthiness, ⁠while ​a month earlier, Fitch affirmed Nigeria’s ​rating at “B” with a “stable outlook”.

Reporting by Bageshri Banerjee in ​Bengaluru and Chijioke Ohuocha; Editing by Leroy Leo