Nigeria’s headline inflation rate moderated further by 48 basis points to 15.43 per cent as general stability in macroeconomic outlook sustained the disinflation trend.
The latest Consumer Price Index (CPI) released yesterday by the National Bureau of Statistics (NBS) showed steady improvement in average cost of living, despite challenges occasioned by constraints in food production and supply and global disruption to energy supply.
Headline inflation rate dropped from 15.91 per cent in June 2026 to 15.43 per cent in July 2026, representing an improvement of 48 basis points.
The overall disinflationary trend was boosted by non-oil and non-energy components of consumer prices, helping the headline to suppress momentary increase in prices of staple foods and energy costs.
The core inflation, which comprises all other items excluding farm produce and energy, improved considerably, dropping by 94 basis points to 14.97 per cent in July as against 15.92 per cent in the previous month.
However, food inflation rose by 279 basis points to 20.31 per cent in July from 17.52 per cent in June, highlighting increases in prices of food items like rice, garri, tomatoes, plantain, beef, onions corn and yam among others.
Analysts were unanimous that the continuing disinflationary trend underlined the stability in the macroeconomic environment, with the nation’s foreign reserves inching towards two-decade peak at above $52 billion and the naira stable around N1, 350 per dollar anchor.
They said the sustained disinflationary trend would enhance price stability, allowing the Central Bank of Nigeria (CBN) to maintain its current monetary stance of observation, rather than tightening.
Analysts, however, underlined the risks posed by irregularities in the food production and supply chain, calling for concerted fiscal measures to address constraints.
Some analysts at SCM Capital said the overall disinflationary trend was ‘supported by continued policy transmission, sustained disinflationary momentum, and favorable base effects’, noting that the improvement reflected ease in pace of price increases across key economic segments.
They said: ‘Headline inflation is projected to continue its disinflationary trend into August, supported by stability in global crude oil prices alongside a stable foreign exchange rate, keeping domestic PMS pump prices and logistics costs broadly unchanged from July levels, limiting further pass-through pressure on transportation and distribution costs.’
The analysts expressed concerns that fertilizer cost pressures and flood-related disruptions could undermine agricultural output, further heightening average cost of food items.
The SCM Capital noted that Federal Government’s tariff adjustments could help cushion against further food price spikes, while the CBN would likely hold interest rates steady to manage excess system liquidity and anchor long-term inflation expectations.
Their counterpart at Arthur Steven Asset Management stated that continued moderation in core and headline inflation suggested that the disinflationary trend remains intact, although elevated food prices pose a key upside risk.
They pointed out that the divergence between sharp decline in core inflation and acceleration in monthly food inflation highlighted increasingly supply-driven nature of Nigeria’s inflationary pressures.
‘Persistent inefficiencies in food production and distribution, seasonal factors, and transportation costs could continue to exert pressure on consumer prices in the near term,’ Arthur Steven Asset Management stated.
According to them, the overall inflationary trend provided some support for a gradual easing bias, particularly given the substantial moderation in core inflation, although the apex bank may tarry a while on the side of caution.
They noted that policymakers may require clearer evidence that the recent moderation in headline and core inflation is sustained before pursuing further significant monetary policy easing.
‘Overall, the July data reinforce the view that Nigeria’s disinflation process is progressing, with headline inflation declining by 0.48 percentage points month-on-month and core inflation easing considerably. Nevertheless, renewed food price pressures remain a key risk to the pace of disinflation, particularly if they persist into the third quarter,’ the Arthur Steven Asset Management analysts stated.
A breakdown underlined the uneven nature of the price pressure across the country. It also showed that while food may not be a problem in some places, energy prices may be and there could be a combination of the two key components.
The overall inflationary pressure was highest in states like Adamawa, Yobe and Anambra, with 33.03 per cent, 25.21 per cent and 23.99 per cent respectively.
Headline inflation was at the lowest in Nasarawa, Kebbi and Borno states, at 7.86 per cent, 9.12 per cent and 9.12 per cent respectively.
Food inflation was highest in Adamawa (51.36 per cent); Katsina (30.84 per cent) and Zamfara State (30.65 per cent).
Borno State has the lowest national food inflation at -0.31 per cent, followed by Nasarawa and Kebbi with 6.88 per cent and Kebbi 12.50 per cent respectively.