September 4, 2026/Coronation Report
Summary
Nigeria’s real Gross Domestic Product (GDP) grew by 4.43% year-on-year (y/y) in Q2’26, its fastest pace in ten quarters and an acceleration from both the 4.23% recorded in Q2’25 and the 3.89% recorded in Q1’26. Nominal GDP at basic prices rose to N119.29tn, up 18.43% y/y from N100.73tn in Q2’25, equivalent to approximately US$87.32bn at a quarterly average exchange rate of N1,366.10/$, according to the CBN.
This reflects elevated price levels and continued activity across key sectors. On a quarter-on-quarter (q/q) basis, real GDP grew by 4.31%, compared with -19.87% in Q1’26, pointing to stronger economic activity and improved momentum in the second quarter of the year. The growth was supported by improvements in the oil and non-oil economies.
The oil sector grew by 7.31% y/y, up from 2.57% in Q1’26 but moderating significantly from 20.46% in Q2’25, as average crude oil production increased to 1.72mbpd, from 1.55mbpd in Q1 and 1.68mbpd in Q2 2025. Meanwhile, the non-oil sector expanded by 4.31% in Q2’26, accelerating from 3.94% in Q1’26 and 3.64% in Q2’25, and remained the dominant source of economic activity, accounting for 95.84% of real GDP.
Consequently, while the headline GDP number points to a strengthening recovery, the composition suggests that Nigeria’s growth challenge remains one of productive capacity. Stronger oil output, agriculture and services are supporting growth, while construction, refining and selected mining activities provide additional momentum. However, weak electricity supply and uneven manufacturing performance continue to constrain industrial expansion and limit the pace of broader-based growth.
Our assessment is therefore cautiously positive. The Q2 performance strengthens the near-term growth outlook, but sustaining a faster pace of expansion will require stronger industrial production, more reliable electricity supply, lower production costs, greater private-sector investment and sustained improvements in oil output. Without meaningful progress on these supply-side constraints, growth is likely to remain moderate despite the improving headline performance.
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