Nigeria’s inflation declines again, but household expenses remain stubbornly high

Nigeria’s inflation rate extended its downward trend in June 2026, offering fresh signs that price pressures are gradually easing following months of tight monetary policy and ongoing fiscal reforms.

However, economists have cautioned that the modest decline has yet to translate into meaningful relief for millions of households grappling with high food prices and the rising cost of living.

The latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) showed that headline inflation eased slightly to 15.91 per cent in June from 15.93 per cent recorded in May, representing a marginal decline of 0.02 percentage points.

The latest figure also marks a sharp improvement from the 25.29 per cent recorded in June 2025, indicating that inflationary pressures have moderated significantly over the past 12 months.

According to the NBS, the month-on-month inflation rate also slowed to 1.66 per cent in June from 1.75 per cent in May, suggesting that although prices of goods and services continued to rise, they increased at a slower pace than in the previous month.

The statistics agency further reported that the average Consumer Price Index for the 12 months ending June 2026 stood at 17.63 per cent, compared with 29.82 per cent during the corresponding period of 2025.

Urban inflation stood at 16.08 per cent year-on-year in June, while monthly inflation accelerated to 2.13 per cent, compared with 1.99 per cent in May.

READ ALSO; Inflation, high interest rates loom as FG credit hits N40.38tn

Despite the monthly increase, the 12-month average urban inflation rate fell sharply to 17.51 per cent, down from 31.64 per cent recorded a year earlier.

In contrast, rural areas experienced a slower pace of price increases. Annual inflation was 15.48 per cent, while month-on-month inflation declined significantly to 0.52 per cent from 1.17 per cent in May.

Average rural inflation also dropped to 17.54 per cent over the 12-month period, compared with 27.65 per cent in June 2025.

The figures suggest that while inflation is easing nationally, price dynamics remain uneven, with urban consumers continuing to experience stronger monthly price pressures than their rural counterparts.

Economic analysts described the latest inflation figures as further evidence that Nigeria’s aggressive monetary tightening and fiscal reforms are beginning to produce the desired results.

They noted that the moderation reflects improved exchange rate stability, a gradual recovery in agricultural supply chains, slower growth in transportation costs and the statistical base effect, which has made year-on-year inflation comparisons more favourable.

Analysts also pointed to the Central Bank of Nigeria’s sustained tight monetary stance, including the maintenance of elevated interest rates, as a major factor in reducing excess liquidity and moderating inflation expectations.

According to economists, improved foreign exchange liquidity and greater stability in the naira have also helped reduce imported inflation, particularly for manufacturers and businesses that depend heavily on imported raw materials.

Despite the encouraging macroeconomic indicators, economists warned that the decline in inflation does not necessarily mean prices are falling.

Rather, they explained, inflation measures the rate at which prices increase, meaning goods and services are still becoming more expensive, albeit at a slower pace.

READ ALSO; Beyond official figures: Nigerians feel the bite of “Invisible Inflation”

Many households therefore continue to face significant pressure from high food prices, transportation costs, rent, healthcare and education expenses.

Economic experts noted that consumers are unlikely to feel substantial relief until inflation declines further into single digits and wage growth begins to outpace increases in living costs.

“The moderation is encouraging from a policy standpoint, but Nigerians are still paying much more for basic necessities than they were two years ago,” one market analyst observed.

Analysts expect inflation to remain on a gradual downward trajectory during the second half of the year, provided current macroeconomic conditions are sustained.

Key factors likely to influence future inflation include exchange rate stability, domestic food production, energy costs, global commodity prices and continued coordination between fiscal and monetary authorities.

Some economists also expect improved harvests during the current farming season to help moderate food inflation in the coming months, provided security conditions in major agricultural belts continue to improve.

Others, however, cautioned that risks remain, particularly from adverse weather conditions, global oil price volatility and supply chain disruptions, which could reverse some of the recent gains.