Welcome to the July 2025 edition of the Duplo Economic Digest, your pulse check on Nigeria’s shifting economic terrain.
July delivered a wave of policy shifts and financial pivots. For finance leaders, it’s a reminder that the numbers are changing, and so must the strategy. Let’s unpack it all.
Nigeria Macroeconomic Recap
Nigeria’s Macroeconomic Landscape in July 2025: Growth Trends, Policy Shifts, and Market Impacts
Nigeria rebases its GDP. In July 2025, the National Bureau of Statistics (NBS) rebased Nigeria’s Gross Domestic Product (GDP), updating the base year from 2010 to 2019. This routine statistical exercise ensures that national accounts reflect the current structure of the economy, capturing new and evolving sectors more accurately. The choice of 2019 as the new base year is mainly due to its significance. It precedes the global disruptions of COVID-19 and coincides with the availability of comprehensive national surveys and administrative data. As a result, the rebased GDP now incorporates previously undercounted sectors, including ICT, digital services, real estate, creative industries, and e-commerce.
Following the rebasing, Nigeria’s 2024 GDP was revised upward to approximately ₦372.8 trillion (about $243 billion), an increase of over 40%. Notably, real estate has now overtaken oil and gas in terms of contribution to GDP, indicating a shift in the economy’s structural composition. Beyond the numbers, this rebasing has practical implications. Key indicators, such as debt-to-GDP and tax-to-GDP ratios, now present a more favourable outlook, which could influence policy, budgeting, and investor sentiment. Most importantly, it provides policymakers with a clearer, data-driven foundation for designing inclusive and future-oriented economic strategies.
Naira Cards Go Global Again: A Boost for Confidence and Trade. In early July 2025, Nigerian banks resumed international transactions on Naira-denominated debit cards, ending a three-year restriction that had hindered cross-border payments for individuals and businesses. Major banks, including UBA, Wema Bank, GTBank, and Access Bank, have announced revised international spending limits, typically between $500 and $ 1,000 per month, signalling a cautious yet strategic step toward liberalising foreign exchange access. This policy reversal comes amid a broader effort to stabilise the naira and rebuild market confidence.
For consumers, it eases the strain of sourcing FX for digital services, tuition, and travel. For businesses, it improves operational flexibility and reduces dependency on costly black-market alternatives. Most importantly, it signals renewed confidence in Nigeria’s FX management and external reserves. While limits remain modest, the move lays the groundwork for greater financial inclusion and a more functional payments ecosystem, especially for startups and SMEs operating globally. If sustained, this shift could mark a turning point in Nigeria’s effort to integrate more seamlessly into the global economy.
Nigeria’s Economy Sees Moderate Growth in H1 2025. In the first half of 2025, Nigeria’s economy expanded by approximately 3.7% year-over-year, marking a gradual yet positive recovery. This performance aligns with earlier projections and was supported by improvements in oil output, services, and manufacturing sectors. Q1 2025 GDP rose by 3.13%, up from 2.27% in the same period of 2024. The services sector led the expansion, contributing over 57% of GDP, while oil production averaged around 1.6 million barrels per day, helping stabilise government revenues.
This growth is also tied to recent economic reforms, including the removal of subsidies, unification of the foreign exchange rate, and ongoing tax restructuring, all of which are improving investor confidence and strengthening the non-oil economy. However, agriculture continues to lag, and inflation remains a challenge for household consumption and business costs. Full-year growth forecasts range from 3.5% to 4.2%, depending on oil stability, fiscal policy implementation, and inflation trends. While the economy is clearly on a recovery path, sustaining and accelerating growth will require targeted reforms, enhanced productivity, and more effective policy coordination.
Nigeria becomes a net importer of US crude. For the first time, Nigeria imported more crude oil from the United States than it exported, marking a reversal in the historic oil trade relationship between the two countries. This shift, which occurred in February and March 2025, was driven by reduced U.S. demand due to refinery maintenance and a surge in domestic demand from the Dangote Refinery, which began operations in January 2024 and is ramping up to its full 650,000 barrels-per-day capacity The refinery’s growing appetite for crude—sourcing 9–10 million barrels monthly from the U.S. and other suppliers—reflects a broader strategic shift in Nigeria’s energy landscape. By refining locally, Nigeria aims to reduce its reliance on imported fuels, improve energy self-sufficiency, and capture more value from its oil.
However, the irony remains that some of this imported crude is Nigerian-origin oil, re-sold by international traders—highlighting inefficiencies in the country’s energy value chain. For Nigeria, this trend could ease long-term pressure on foreign exchange reserves by cutting refined fuel imports, potentially supporting the naira and strengthening the country’s trade position. For businesses, locally refined fuels could lower costs and improve supply stability, while Dangote stands to gain significant market power across West Africa. Although analysts view the trade reversal as temporary, it highlights how domestic infrastructure—such as the Dangote Refinery—can alter global oil flows and redefine Nigeria’s role in the petroleum industry.
Finance Flashback
CBN’s Calculated Caution for the month
CBN Holds Interest Rate at 27.5%: A Signal of Caution Amid Easing Inflation. At its July 2025 Monetary Policy Committee meeting, the Central Bank of Nigeria (CBN) voted to maintain the benchmark interest rate at 27.5% for the third consecutive time this year. The decision comes as headline inflation continues to ease, falling to 22.22% in June, down from 22.97% in May, indicating that earlier rate hikes may be starting to yield results. The CBN’s decision reflects a strategy of policy consolidation, allowing time to assess the full impact of the aggressive tightening cycle in 2023–2024, which saw six consecutive rate increases. By holding the rate, the Bank aims to strike a balance between sustaining disinflation and supporting economic activity. While the pause offers some relief to markets, borrowing costs remain high, which may slow private sector lending, investment, and consumer spending. However, the hold is seen as a signal of policy consistency and the CBN’s ongoing commitment to price stability. Looking ahead, future rate decisions will depend on how inflation trends evolve, the strength of the naira, and broader fiscal and global economic conditions.
Inflation Trend Reverses in Q2 2025. Nigeria experienced a notable easing of inflationary pressures in the second quarter of 2025, marking a significant turnaround after months of persistent price surges. Headline inflation dropped to 22.22% year-on-year in June, from 22.97% in May and 24.61% in April, continuing a three-month downward trend. This reversal follows a peak of 33.69% in March 2024, and reflects the initial impact of several economic and statistical adjustments. One major contributor to this change was the rebasing of the Consumer Price Index (CPI) by the National Bureau of Statistics in April 2025.
The updated basket better reflects current consumption patterns, particularly with food now accounting for 51% of the weighting. This methodological update, along with favorable base effects, partly explains the disinflation seen during Q2. While the year-on-year inflation rate has improved, monthly inflation remained relatively sticky, rising to 1.68% in June, from 1.53% in May. This shows that although the pace of annual inflation is slowing, consumers continue to face price increases on a month-to-month basis.
CBN and the Presidency launch a Financial inclusion initiative. The CBN, in collaboration with the Office of the Vice President, has unveiled a draft National Framework for Strengthening Trust for Sustainable Economic and Financial Inclusion. The initiative aims to rebuild public confidence in the formal banking system, particularly among low-income, rural, and vulnerable Nigerians who have historically been excluded from financial services. The framework focuses on improving complaint resolution, tackling fraud and digital insecurity, and boosting financial literacy. It aligns with President Tinubu’s Renewed Hope Agenda and may be backed by legislation following stakeholder consultations. Despite rising financial inclusion—64% of adults used formal services in 2023—trust remains low due to poor customer experiences. The initiative seeks to make banking more transparent, inclusive, and responsive.
NGX Performance
From Market Peaks to Policy Pauses
Between June and July 2025, the Nigerian Exchange (NGX) maintained strong bullish momentum, with the All-Share Index (ASI) rising from around 116,000 points in early June to over 126,000 points by mid-July, marking a historic high. As of June 30, the ASI had delivered a year-to-date (YTD) gain of 16.57%, while total market capitalisation rose significantly to ₦75.96 trillion from ₦62.76 trillion at the end of 2024. This impressive performance was driven by improved investor sentiment, underpinned by macroeconomic reforms, easing inflation, and stable monetary policy. The Central Bank of Nigeria maintained its benchmark interest rate at 27.75%, offering predictability to market participants.
A major contributor to the market rally was the ongoing banking sector recapitalisation effort, which has triggered robust capital-raising activities and increased investor appetite. The banking index alone posted an 18% YTD growth, driven by strong performances from major players. GTCO led with a remarkable 42% gain, while other top-tier banks such as Zenith Bank, Fidelity Bank, and Stanbic IBTC also recorded double-digit returns. The sector collectively raised over ₦2.4 trillion in Q1 through rights issues and public offerings, reinforcing confidence in its capacity to meet new regulatory capital thresholds.
Beyond banking, the consumer goods sector recorded exceptional gains of over 50% YTD, supported by resilient demand and strong earnings from companies like Vitafoam, Honeywell Flour Mills, and Presco. The insurance sector also showed modest growth of around 5%, with notable performances from NEM Insurance and Linkage Assurance. On the other hand, the oil and gas sector underperformed, declining by about 9.9%, weighed down by losses in Seplat, Oando, and Aradel, despite gains by Eterna and Total Nigeria. Adding to market optimism was the gradual stabilisation of the foreign exchange market, following reforms under the FX unification policy.
These improvements helped restore some foreign investor confidence, particularly as Nigerian equities remained relatively undervalued compared to those of other emerging markets. However, market analysts warn that lingering challenges, including FX liquidity, fiscal execution, and global interest rate trends, could introduce volatility in the months ahead. Still, the sustained rally in June and July highlights the depth of investor confidence in Nigeria’s capital markets and signals growing belief in the long-term impact of structural reforms. The NGX has emerged as one of the few economic bright spots in 2025, with continued reform momentum expected to support further gains.
FX Performance
Stability Amid Tight Reform
In July 2025, Nigeria’s foreign exchange (FX) market remained relatively stable. Still, it showed signs of gradual depreciation in the value of the naira against the US dollar. At the beginning of the month, the naira traded at ₦1,529.07 per dollar on July 1. It remained fairly steady through mid-month, closing at ₦1,529.76 on July 16, but weakened slightly to ₦1,534.29 by July 24. This steady upward drift in the exchange rate, about ₦5 over three weeks, reflected sustained demand for foreign currency despite the Central Bank of Nigeria’s efforts to manage volatility through regular interventions.
During this period, investor sentiment was cautiously optimistic, supported by the CBN’s ongoing reforms to liberalise the FX market and improve transparency. The naira’s movement remained within a tight band, helped in part by stable foreign portfolio inflows attracted to Nigeria’s high-interest sovereign instruments. Inflationary pressure continued to ease slightly, following a reported headline inflation rate of 22.22% in June, with expectations of further moderation in July. Nevertheless, pressure on the naira persisted due to strong import demand, limited non-oil FX inflows, and a gap between official market rates and the assumptions embedded in the federal budget, which projected a significantly stronger exchange rate. Despite these challenges, the FX market between July 1 and 25 exhibited relative calm, signalling a period of consolidation as policy reforms took deeper root.
Company Focus – GTCO Goes Global
GTCO’s Bold Step onto the London Stage
Guaranty Trust Holding Company Plc (GTCO) has achieved a significant milestone by getting listed on the London Stock Exchange (LSE), becoming one of the few Nigerian financial institutions to do so. This strategic move enhances GTCO’s access to international capital, broadens its investor base, and strengthens its global brand presence. The listing reflects growing investor confidence in GTCO’s strong governance, profitability, and diversified operations across banking, asset management, and fintech.
It also comes at a time when Nigeria is seeking to attract more foreign portfolio investment, stabilise its foreign exchange market, and project the strength of its leading corporations. For the Nigerian economy, GTCO’s LSE debut sends a positive signal about the global competitiveness of local institutions. It may also inspire other top-performing firms to consider international listings as a way to hedge currency risks and expand their growth horizon. As GTCO navigates this new phase, its performance will be a key indicator of how Nigerian companies can thrive on the global stage.
Africa Focus
Africa’s Economic Crossroads: Reform, Resilience, and Rising Ambitions
Kenya Sustains Regional Growth Lead with 5.3% GDP Projection for 2025: Kenya is poised to maintain its position as one of East Africa’s top economic performers, with GDP growth projected at 5.3% in 2025. Large-scale infrastructure investments, a resilient agricultural sector, and rapid expansion in digital services continue to drive this momentum. Government spending on transport and energy projects is boosting productivity, while favourable weather patterns and policy support have revived agricultural output. At the same time, Kenya’s thriving tech ecosystem, anchored by mobile money and digital platforms, continues to attract investment and enhance service delivery. The country’s diversified growth model positions it well above regional averages, reinforcing its role as a key economic hub in East Africa.
South Africa Seeks $500 Million in ESG-Linked Funding Following Budget Deal. Following the resolution of a budget deadlock, the South African government is now pursuing $500 million in foreign currency funding to support its 2025/26 fiscal year budget and bolster its debt management efforts. The funding strategy includes the use of Environmental, Social, and Governance (ESG) bonds alongside other innovative instruments, reflecting a growing shift toward sustainable and diversified financing sources. This approach aims to ease fiscal pressures while aligning with global trends in responsible borrowing. As South Africa navigates tight domestic and external financial conditions, the success of this funding initiative will be crucial for maintaining economic stability and investor confidence.
Loan to Chad to Support Stability and Growth. The International Monetary Fund has approved a $625 million loan for Chad as part of a four-year program aimed at stabilising the country’s fiscal position, strengthening social services, and boosting infrastructure investment. The plan sets ambitious targets, including an annual economic growth rate of 8% and a cap on public debt at 32% of GDP by 2030. The support package comes as Chad faces continued economic pressure from debt vulnerabilities and global shocks, with the IMF emphasising the need for strong policy implementation to achieve lasting macroeconomic stability and inclusive growth.
Africa’s Cross-Border Payments Set for Trillion-Dollar Expansion by 2035: Africa’s cross-border payments market is on track for significant expansion, with projections indicating a rise from $329 billion in 2025 to over $1 trillion by 2035, representing an annual growth rate of approximately 12%. This surge reflects the deepening of regional integration, rising intra-African trade, and the increasing adoption of digital financial services across the continent. As the African Continental Free Trade Area (AfCFTA) gains momentum, demand for faster, cheaper, and more efficient payment systems is expected to grow, driving innovation in fintech and financial infrastructure. The projected growth underscores Africa’s evolving economic landscape and its push toward a more connected, cashless future.
AfDB Cuts Africa’s 2025 Growth Outlook: The African Development Bank has revised Africa’s 2025 GDP growth forecast down to 3.9% from an earlier 4.1%, citing growing uncertainty from global trade tensions and new tariffs. Although still stronger than 2024’s 3.3%, the downgrade reflects concerns over weakened export demand and volatile commodity prices, especially with the U.S. imposing steep import duties on certain African goods. Despite this, the AfDB remains cautiously optimistic, projecting that over 21 countries, including Ethiopia, Rwanda, and Senegal, to grow above 5%, with East Africa leading at 5.9%. The Bank emphasised the need for stronger structural reforms, fiscal discipline, and deeper intra-African trade to sustain resilience in the face of external shocks.
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Upcoming events in August 2025
- Connected Banking Summit
13th August
Addis Ababa, Ethiopia - Banking Transformation Africa
21 – 22 August
Johannesburg, South Africa
Quiz
- What year did Nigeria’s GDP base year change to after the July 2025 rebasing exercise?
- What was Nigeria’s GDP growth rate in Q1 2025?
- What country is projected to lead East Africa’s regional growth in 2025?
