Nigeria’s economy is projected to expand by 4.12 per cent this year, an improvement from the 3.87 per cent growth recorded in 2025, Cowry Asset Management Limited has projected.

The growth is to be driven by stronger domestic economic activities, easing inflation and improving macroeconomic conditions.

Analysts at Cowry Asset said the anticipated growth would be driven by easing inflationary pressure, improved stability in the foreign exchange market and a more accommodative monetary policy environment.

These are expected to boost investor confidence and stimulate economic activities across key sectors.

According to the analysts, the latest report released by the National Bureau of Statistics (NBS) showed that real gross domestic product (GDP) expanded by 3.87 per cent year-on-year in 2025, improving from 3.38 per cent recorded in 2024 and slightly outperforming the firm’s 3.86 per cent growth forecast for the year.

The stronger-than-expected performance was attributed to a more supportive macroeconomic environment, driven by a gradual recovery in consumer demand as inflationary pressure eased and a less aggressive monetary policy stance.

The report noted that economic growth in 2025 was broad-based, with strong expansion across major sectors, including industry, services and agriculture.

Industry grew by 4.57 per cent, while the services sector expanded by 4.14 per cent. Agriculture recorded a 2.92 per cent growth during the year.

Cowry Research said improved performances in areas such as oil refining, construction, transportation, financial services, mining and quarrying underscored the positive impact of relatively lower input costs, improved foreign exchange stability and post-harvest gains on productive activities.

In real terms, aggregate GDP rose to N221.55 trillion in 2025, up from N213.29 trillion recorded in 2024, with the fourth quarter contributing the largest share at N63.97 trillion.

Nominal GDP also increased significantly to N431.18 trillion, compared with N364.62 trillion in the previous year, reflecting the impact of the recent GDP rebasing.

Quarterly, economic growth accelerated to 4.07 per cent year-on-year in the fourth quarter of 2025, up from 3.98 per cent in the third quarter and 3.76 per cent in the corresponding period of 2024, highlighting improving growth momentum towards the end of the year.

The services sector remained the largest contributor to growth, accounting for 55.9 per cent of real GDP in the fourth quarter of 2025, compared with 53 per cent in the preceding quarter, supported mainly by activities in information and communication, financial and insurance services, trade and real estate.