The finance minister says lowering inflation and interest rates would reduce government borrowing costs, as Nigeria intensifies efforts to strengthen economic stability and ease pressure on households……
The Federal Government could save more than $10 billion by bringing inflation and interest rates into single digits, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said.
Oyedele made the disclosure on the sidelines of the 2026 International Monetary Fund (IMF) and World Bank Group annual meetings in Bangkok, Thailand, where he stressed the importance of closer coordination between monetary and fiscal authorities.
He said reducing inflation would create room for lower interest rates, helping to ease the government’s financing costs and reduce pressure on public finances.
According to the minister, the potential savings, based on 2026 figures, make price stability a major priority for the government as the Central Bank of Nigeria (CBN) advances plans to adopt inflation targeting.
“We are enhancing our collaboration between monetary and fiscal authorities. And already we are aware that the monetary authorities are pivoting from monetary to inflation targeting, which means our collaboration is now even more important than it has ever been,” Oyedele said.
He added that bringing inflation down to single digits would help create the conditions for interest rates to follow the same path.
“From the fiscal side, whatever we need to bring inflation to a single digit, thereby creating the conditions for interest rates to also be single digit, will save the fiscal side as of 2026 numbers more than US$10 billion,” he said.
“This is a top priority for us,” the minister added.
Oyedele also praised the CBN’s management of the foreign exchange market, saying it had contributed to greater stability in the naira and its recent appreciation.
“The good thing is, because of the way the central bank has been able to help us manage the FX environment generally, we’ve seen the naira not only being stable but steadily appreciating,” he said.
The minister’s remarks come as Nigeria records a gradual moderation in headline inflation, although households continue to face significant pressure from the high cost of essential goods and services.
Headline inflation eased slightly to 15.39 per cent in August 2026 from 15.43 per cent in July, extending the decline for a third consecutive month.
However, a Central Bank of Nigeria survey showed that the proportion of households perceiving inflation as high increased to 77.2 per cent in September, from 67.2 per cent in August.
Earlier findings from the survey also indicated that 68.4 per cent of Nigerians earning below ₦70,000 monthly considered inflation high in August, the largest share among the income groups surveyed.
The figures highlight the gap between the moderation in the official inflation rate and the continuing pressure on household purchasing power.
Although a lower inflation rate means prices are rising more slowly, it does not necessarily mean that the prices of goods and services have returned to previous levels.
IMF Raises Nigeria’s Growth Outlook
Nigeria’s efforts to strengthen economic stability come amid improved growth projections from international financial institutions.
The International Monetary Fund raised its forecast for Nigeria’s economic growth to 4.2 per cent in 2026 and projected an expansion of 4.3 per cent in 2027.
The projections were contained in its October 2026 World Economic Outlook, titled Resilience Under Strain, Urgent Choices, presented in Bangkok.
The World Bank also raised its growth forecast for Nigeria to 4.3 per cent in 2026, compared with estimated growth of 4.0 per cent in 2025. It projected growth of 4.4 per cent in both 2027 and 2028.
Despite the improved outlook, the challenge for policymakers remains translating stronger economic performance into lower living costs, improved purchasing power and more affordable financing for the government and businesses.
Oyedele’s remarks suggest that the government sees closer coordination with the CBN and sustained progress on inflation as important steps towards reducing borrowing costs and strengthening public finances.
