Food Price Surge Threatens Inflation Gains, CPPE Warns — Urges Structural Reforms
Despite a decline in headline inflation for the fourth consecutive month, the Centre for the Promotion of Private Enterprise (CPPE) has raised alarm over persistent food price hikes and monthly inflation increases, which it says reveal deeper structural problems in Nigeria’s economy. The warning comes as the National Bureau of Statistics reported headline inflation fell slightly from 22.22% in June to 21.88% in July 2025.
CPPE Director/CEO Dr. Muda Yusuf described the latest inflation data as showing a “mixed outlook” that requires both caution and sustained reforms. He noted modest improvements: food inflation on a month-to-month basis dropped from 3.25% to 3.12%, while core inflation slowed sharply from 3.46% to 0.97% month-on-month. These figures reflect some macroeconomic stability, partly due to exchange rate improvements, duty waivers on key food imports like rice and maize, and a statistical base effect from 2022’s high inflation.
However, Yusuf emphasized that emerging inflationary pressures remain concerning. Month-on-month headline inflation actually rose from 1.68% in June to 1.99% in July, while year-on-year food inflation climbed from 21.97% to 22.74%. He said these figures highlight Nigeria’s continued vulnerability to supply-side shocks — including insecurity, high logistics costs, and inefficiencies at the ports.
Calling for urgent structural reform, Yusuf advised the government to maintain macroeconomic stability through foreign exchange management and prudent fiscal policy. He also urged a rethink of traditional monetary tools such as the Monetary Policy Rate (MPR) and Cash Reserve Ratio (CRR), especially since business lending rates are already above 30%, further squeezing private sector growth.
Yusuf concluded that while inflation trends suggest tentative progress, Nigeria’s inflation battle is far from over. “The July 2025 inflation report provides a basis for cautious optimism. But a coordinated mix of monetary, fiscal, and structural interventions will be required to consolidate recent gains and steer the economy toward sustained stability,” he said.
Source: Punch