Nigeria Targets MSCI and JPMorgan Re-entry After Securing FTSE Comeback

Nigeria is stepping up efforts to regain its place in major international equity and bond indices following confirmation that the country will return to FTSE Russell’s Frontier Market category.

The FTSE reclassification will take effect on September 21, 2026, moving Nigeria from Unclassified to Frontier Market status.

FTSE Russell said Nigeria now satisfies all five of its Quality of Markets requirements for frontier status. The index provider cited improvements in foreign-exchange access, the clearance of outstanding FX queues and the ability of international institutional investors to repatriate their capital without significant delays.

Director-General of the Securities and Exchange Commission, Emomotimi Agama, said regulators would now focus on securing Nigeria’s reinclusion in the indices maintained by MSCI and JPMorgan.

According to Agama, the progress reflects the growth of the Nigerian capital market and improvements made to address concerns that previously discouraged international investors.

MSCI moved Nigeria from Frontier Market to Standalone Market status during its February 2024 index review. The decision followed prolonged foreign-exchange liquidity challenges that prevented investors from reliably converting naira proceeds and moving funds out of the country.

JPMorgan had earlier removed Nigeria from its Government Bond Index–Emerging Markets in 2015, citing currency controls and difficulties affecting transactions in the country’s foreign-exchange market.

Emerging-markets strategist Charlie Robertson said Nigeria could return to the indices if the government maintains the appropriate policy environment.

He noted that Nigeria once accounted for more than 10 per cent of a major frontier equity index. However, repeated periods when investors struggled to repatriate funds damaged confidence and turned the country into an off-index investment that many global fund managers avoided.

Conditions have since improved following foreign-exchange reforms introduced in 2023. These included replacing the multiple exchange-rate structure with a more market-driven system.

Nigeria’s external reserves have also risen, while improved dollar availability has helped reduce the repatriation difficulties experienced by foreign portfolio investors.

Returning to the MSCI and JPMorgan benchmarks could potentially attract more international capital than the FTSE reclassification alone. Many global investment funds use these indices to determine the markets and securities included in their portfolios.

Index membership does not automatically guarantee substantial foreign inflows. Investors will continue to assess exchange-rate stability, market liquidity, inflation, policy consistency and their ability to repatriate investment proceeds.

Sustaining the reforms that supported the FTSE decision will therefore be essential if Nigeria is to convince MSCI and JPMorgan that improvements in market accessibility are durable.

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Nigeria’s inflation rate dropped to 18.02% in September 2025, marking the lowest level in three years, according to data from the National Bureau of Statistics (NBS). The decline represents the sixth consecutive month of slowdown and a dramatic fall from the 34.19% peak recorded in June 2024, signaling growing confidence in the Central Bank of Nigeria’s (CBN) strategy to curb inflation.

At the IMF World Bank Annual Meetings in Washington, CBN Governor Olayemi Cardoso stated that inflation is expected to continue on a downward path in the near term. He attributed this trend to sustained tight monetary conditions, a stabilizing naira, and improvements in food supply across the country.

To tackle inflationary pressures, the CBN pursued an aggressive tightening cycle, raising the Monetary Policy Rate (MPR) from 18.75% in July 2023 to 27.50% by mid-2025, before slightly easing it to 27.00% in September. The Cash Reserve Ratio (CRR) for commercial banks was also lifted to 50%, later reduced to 45%, as part of what the Bank calls a firm anti-inflationary stance.

Core inflation eased to 19.53%, while food inflation the most volatile component fell to 16.87%, reflecting stronger agricultural output and lower logistics costs. The CBN noted that these improvements were reinforced by ongoing foreign exchange market reforms, which have stabilized the naira and narrowed the gap between the official and Bureau de Change (BDC) rates to less than 2%, compared with double-digit disparities a year earlier.

According to the CBN, the stabilization of the naira has been instrumental in reducing imported inflation. The Bank added that enhanced FX liquidity and reduced market volatility are contributing to stronger price stability. Nigeria’s foreign reserves have also risen above $43 billion, providing more than eleven months of import cover, a development driven by consistent foreign exchange inflows and growing investor confidence in government reforms.

While inflation remains above the CBN’s target range, the continued moderation has eased pressure on households and businesses. Analysts say this progress could offer room for future interest rate adjustments if the disinflation trend persists. The CBN emphasized that its priority is to consolidate these gains by maintaining exchange rate stability, boosting food production, and moderating energy costs to sustain price stability.

Governor Olayemi Cardoso reaffirmed the Bank’s commitment to restoring macroeconomic balance and anchoring inflation expectations. “Inflation affects every Nigerian,” he said. “Our job is to ensure that monetary policy supports a stable and predictable environment for growth.”

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