LONDON, July 2 (Reuters) - Nigeria needs to adapt its

2025 budget to lower oil prices and scale up cash transfers to

shield the most vulnerable parts of its population, the

International Monetary Fund said on Wednesday.

Releasing the results of its routine "Article IV" assessment

of Nigeria's economic policies, the IMF said economic growth had

been steady but too low in per capita terms with inflation

remaining high. The Fund predicted that the country's economy

would expand at 3.4% this year and 3.2% in 2026.

"The international economic environment that Nigeria lives

in and operates in is marked by the very, very large

uncertainty, and in particular, international oil price

volatility impacts Nigeria directly through the fiscal and the

external balances as well as inflation," said Axel

Schimmelpfennig, the Fund's mission chief for Nigeria.

The complex outlook made it more important than ever for

policymakers to build and maintain buffers while being nimble

and ready to respond to shocks or seize opportunities, he said.

"Turning to our policy messages, the key challenge now is to

tackle high poverty and food insecurity."

Africa's largest oil exporter had assumed a price of $75 per

barrel in its 2025 budget. Brent crude futures last traded at

just over $68 a barrel.