Nigeria Inflation Outlook Brightens as Analysts Predict Gradual Decline from July
Nigeria’s inflation outlook is showing signs of improvement as financial analysts project a gradual easing of price pressures beginning in July and extending into the third quarter of 2026. The forecast comes in the wake of the latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS), which revealed that inflation remains elevated but could soon begin to moderate.
According to analysts at Comercio Partners, recent developments in the global economy have reduced some of the factors that have been driving inflation higher. The firm noted that the peace agreement reached by parties involved in the Middle East conflict, coupled with a significant decline in global crude oil prices, has improved the near-term outlook. These developments are expected to lessen the risk of another energy-driven surge in consumer prices.
Despite the positive outlook, the latest inflation figures indicate that Nigerians are still grappling with rising costs. Headline inflation climbed to 15.93 percent in May from 15.69 percent in April, while food inflation rose to 16.96 percent. Core inflation, which excludes volatile items, also increased to 16.82 percent, highlighting persistent pressure on both food and non-food goods across the country.
Analysts explained that lower oil prices could provide much-needed relief for households and businesses if the trend continues. In Nigeria, fuel prices heavily influence transportation, logistics, production, and food distribution costs. As a result, sustained declines in crude oil prices could gradually reduce operating expenses and help slow the pace of price increases across key sectors of the economy.
However, Comercio Partners cautioned that inflation is likely to remain stubborn in June, as the benefits of lower oil prices may take time to reach consumers. Nonetheless, the balance of risks has shifted in a more favorable direction. The analysts believe the reduced threat of an energy-led inflation shock could allow the Central Bank of Nigeria (CBN) to maintain its current wait-and-see approach rather than introduce aggressive policy measures, provided domestic prices begin to reflect the easing trend in global energy markets.
source: newtelegraph