Nigeria’s inflation slows to 21.8% four times in a row, but food prices still bite

Nigeria’s headline inflation slowed down for a fourth consecutive month, offering a technical victory to the central bank in its fight against soaring prices, even as households contend with a relentless surge in food costs.

Consumer prices dropped to 21.8% in July from 22.22% in June 2025, the National Bureau of Statistics reported Friday in Abuja. The figure, which marks the slowest pace of inflation this year, was largely driven by favourable base effects from a period of exceptionally high prices in early 2024.

Despite the statistical cooldown, pressure remains on the ground. Food inflation, a key driver of hardship for millions of Nigerians, accelerated to 22.74% from the previous month, underscoring the disconnect between the headline data and the consumer reality.

The moderation in the headline rate was supported by several factors. They include a decline in global and domestic energy prices; pass-through effects from last year’s fuel subsidy removal and currency devaluation. A high statistical base from last year flattered the year-on-year comparison.

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The data will be welcomed by the Central Bank of Nigeria’s Monetary Policy Committee (MPC), which has held its benchmark rate at a record high of 27.50% to tame inflation.

However, a dovish pivot is considered highly unlikely at its next meeting. The consensus among economists is that policymakers will hold the rate steady to ensure inflation is firmly on a downward trajectory before considering any easing.