Inflation Climbs Toward 16% as Geopolitical Tensions and Rising Costs Pressure Nigerian Economy

Nigeria’s inflationary pressure continued its steady climb in May 2026, with the headline inflation rate rising to 15.93%, according to the latest data from the National Bureau of Statistics (NBS). This marks the third consecutive monthly increase, signaling renewed strain on household budgets despite earlier signs of easing earlier in the year.

The report showed that inflation rose slightly from 15.69% in April, driven largely by persistent cost pressures in food, transport, housing, and energy. While the month-on-month inflation rate slowed to 1.75%, the annual upward trend highlights that prices are still rising, even if at a more gradual pace compared to previous months.

Food remains the biggest driver of inflation, contributing over 6 percentage points to the overall rate. Staple items such as rice substitutes, maize, yam, tomatoes, pepper, and cassava products continue to push household spending higher, with food inflation recorded at 16.96% year-on-year. Other key sectors including transport, accommodation, education, and healthcare also added significant pressure to the overall index.

Beyond domestic factors, economists and private sector leaders pointed to global shocks as a major trigger. Rising geopolitical tensions in the Middle East, disruptions in oil supply routes, higher shipping costs, and increased energy prices have all fed into Nigeria’s inflation problem. Business leaders warned that these external pressures are compounding local challenges like insecurity and import bottlenecks.

Despite the rise, analysts note that inflation remains significantly lower than the 26.06% recorded in May 2025, suggesting some level of macroeconomic stabilization over the past year. However, experts caution that continued insecurity in farming regions, high fuel prices, and structural inefficiencies in trade and logistics could keep inflation elevated in the coming months if not addressed.

source: punch