Despite global unrest caused by the ongoing geopolitical tensions, the Africa Export Import Bank (AfreximBank) has projected that global headline inflation would fall to around 3.8 per cent before the last quarter of this year.

It, however, noted that services inflation remains persistent in many advanced economies and that the outlook remains vulnerable to ongoing tensions, climate-related supply disruptions and commodity price volatility.

This was contained in the Bank’s ‘Monthly Developments in the African Macroeconomic Environment’ market update report released by the bank.

The report also provides a timely assessment of the evolving global and African macroeconomic landscape at a moment when the world economy is transitioning from a period of successive shocks toward cautious stabilisation.

It stated that beneath the ‘stability’ lies a deeper structural transformation that will shape Africa’s economic prospects in the years ahead.

“Global output is estimated to have expanded by about 3.3 per cent in 2025, with similar growth expected in 2026 and 2027. While this signals resilience following the pandemic, geopolitical tensions, energy price volatility and aggressive monetary tightening, it also reflects a structural downshift from the pre-2008 global growth average of nearly four per cent. The global economy is stabilising, but at a lower long-term growth trajectory,” it said.

The report stated that the era of ultra-low interest rates appears to be over as structural factors, including high public debt, tighter global liquidity conditions and re-pricing of risk, are likely to keep interest rates higher for longer.

“This has important implications for emerging and frontier markets, including African economies, which may face elevated external borrowing costs and tighter financial conditions,” it added.

The report noted that a major driver of future global productivity is the rapid acceleration in investment in artificial intelligence, semiconductors, cloud infrastructure and digital technologies.

While the investments are transforming global value chains and productivity potential, the report noted that they remain highly concentrated in advanced economies and a few emerging markets, raising the risk of widening technological and productivity gaps across regions.

On what this means for Nigeria and the rest of Africa, the report pointed out that African economies continue to demonstrate resilience despite major global headwinds.

“However, the combination of slower global growth, tighter financial conditions and heightened geopolitical fragmentation underscores the urgency of strengthening intra-African trade, deepening regional value chains, and mobilising innovative sources of development finance,” it stated.