Insecurity and Hovering Meals Costs: Why CBN’s MPC Should Goal the Actual Enemy Regardless of Beneficial Macroeconomic Tailwinds

BY BLAISE UDUNZE

Clearly, one would say that the macroeconomic indicators are lastly pointing in the best path, but, each day realities for households and companies inform a really totally different story as a result of Nigeria stands at a fragile intersection. Little doubt on paper, inflation is easing, the naira is stabilising, and sovereign rankings have improved; however meals costs stay painfully excessive, buying energy continues to deteriorate, and insecurity is ravaging the agricultural worth chain whereas guaranteeing that any progress in inflation moderation stays fragile.

Because the Central Bank of Nigeria (CBN) convenes its 303^rd Financial Coverage Committee (MPC) as its closing assembly of the yr on 24-25 November, the dilemma earlier than it’s clear: Ought to it reply to enhancing macroeconomic knowledge with additional financial easing, or ought to it recognise that the true enemy of value stability just isn’t merely financial however structural, deeply rooted in insecurity and collapsing meals provide?

The truth confronting the nation is that, regardless of the beneficial macroeconomic tailwinds, Nigeria’s largest inflationary risk is insecurity-induced meals inflation, which stays largely unaddressed. Till the MPC anchors its choices round this core problem, financial coverage will proceed to chase shadows.

A Fall in Inflation, however Not in Hardship

The Nationwide Bureau of Statistics’ newest Shopper Worth Index (CPI) report revealed that inflation improved for the second consecutive month, falling sharply from 18.02 p.c in September to 16.05 p.c in October 2025, which is the bottom in 44 months. This moderation was pushed by a brand new CPI base yr and a few easing in meals costs.

While the headline inflation has slowed, month-on-month inflation elevated from 0.72 p.c to 0.93 p.c, underlining persistent value strain on the family stage. Nigerians are nonetheless struggling to pay extra for meals, transport, vitality, housing, and important companies.

Clearly, the Organised Non-public Sector (OPS) welcomed the drop however rapidly cautioned that it doesn’t mirror real-life situations.

Dr. Muda Yusuf, CEO of the Centre for the Promotion of Non-public Enterprise, summarised this contradiction completely, “The sharp moderation in October inflation represents a major win for macroeconomic stability. Nevertheless, the complete welfare advantages are but to be felt because of persistent structural constraints, particularly in meals provide, transportation, vitality, housing, and important companies.”

These “structural constraints,” in actuality, are overwhelmingly traced to insecurity, which is the silent drive disrupting agricultural manufacturing and distribution throughout Nigeria.

Meals Inflation: The Coronary heart of the Disaster

Presently, meals inflation stays Nigeria’s most damaging and persevering value drawback. Even with the October headline easing, meals costs stay abnormally excessive.

Eke Ubiji, the Director-Common of the Nigerian Affiliation of Small and Medium Enterprises (NASME), flagged the inflation knowledge as disconnected from actuality, “Ship folks to the market now. A half-bag of rice goes for between N30,000 and N40,000. Earlier than, a full bag was about N20,000. So, are we shifting ahead or backwards?”

This isn’t a mere anecdote; it’s the lived expertise of thousands and thousands. Meals inflation has remained structurally excessive for almost 5 years, and the basis trigger just isn’t financial growth; it’s insecurity.

Throughout key food-producing belts like Benue, Plateau, Niger, Kaduna, Katsina, Zamfara, Taraba, Kebbi, and Sokoto, farmers can not entry farmlands because of the following adversarial elements:

–       Banditry

–       Terrorist assaults

–       Herdsmen conflicts

–       Kidnapping-for-ransom

–       Destruction of crops and storage services

–       Extortion and unlawful “harvest taxes” by felony teams

For this reason the MPC’s choices, regardless of how sound, have restricted influence. Financial tightening can not cease gunmen from attacking farmers. Rate of interest changes can not clear gridlocked rural roads. Liquidity controls can not repair the collapse of rural markets emptied by chaos.

Femi Egbesola, the President of the Affiliation of Small Enterprise Homeowners of Nigeria, echoes this lived rigidity, “All of this has not translated to tangible leads to the lives of households and small companies. It has been very powerful, and it’s even getting more durable.”

With out resolving insecurity, meals inflation will proceed to undermine each macroeconomic acquire.

OPS: Nigerians Don’t Really feel the Aid

Throughout all private-sector teams, one message is fixed, inflation numbers are falling, however hardship stays excessive.

–       SMEs are shutting down because of excessive enter prices.

–       Customers’ buying energy is collapsing.

–       Operational prices stay greater.

–       Meals stays largely unaffordable.

Based on Ubiji, there isn’t any relationship between what’s sustainable out there and what they’re quoting of their boardrooms.

This scepticism is rooted in the truth that meals costs, by far the biggest a part of family spending, stay stubbornly excessive as a result of insecurity continues to decimate provide.

Even the Lagos Chamber of Commerce and Business (LCCI) acknowledged that whereas there are “inexperienced shoots,” they’re small and fragile.

LCCI President, Gabriel Idahosa, mentioned, “A development is being established… however Nigerians usually doubt the inflation numbers as a result of they don’t see it on their eating desk.”

The MPC should confront this actuality: financial coverage can not ship value stability whereas insecurity is concurrently destroying meals manufacturing.

Enhancing Macroeconomic Indicators: A Window of Alternative

Apparently, Nigeria’s macroeconomic fundamentals have improved considerably as inflation is moderating, FX liquidity is rising, the naira is strengthening, non-oil exports are rising, home manufacturing of refined petroleum is enhancing, S&P upgraded Nigeria’s sovereign credit score outlook, and GDP grew by 4.2 p.c in Q2 and is projected to document 3.6-3.9 p.c in Q3.

Little doubt, these are vital achievements that create fiscal and financial house for reforms. However beneficial indicators can not cowl the truth that Nigeria continues to be battling a meals inflation disaster fueled by worsening insecurity. If the MPC doesn’t align its coverage response with this structural actuality, financial coverage could stay misaligned with on-ground financial forces.

What Analysts Anticipate on the November MPC Assembly

Forward of the MPC assembly, analysts stay divided. Some are calling for additional easing. Umar Abdulqadir of CFG Africa believed the MPC ought to lower by not less than 50bps, citing sustained disinflation, improved FX liquidity, higher meals provide situations, and decrease threat premia after S&P improve. He argued that top lending charges have been constraining SME credit score entry and {that a} lower would “stimulate funding and bolster financial restoration.”

Equally, Afrinvest’s Damilare Asimiyu tasks a 25-50bps lower, citing beneficial inflation trajectory, improved macro knowledge, international central banks adopting gentle dovish tones, and robust GDP development. He believes cautious easing is justified.

In the meantime, different analysts counsel a maintain at 27 p.c. Jessica Ifada of Rostrum Funding & Securities insists that the MPC ought to keep September’s price cuts, that are nonetheless filtering by means of the economic system. CRR discount has elevated financial institution liquidity, and banks have largely met recapitalisation thresholds, whereas festive-season inflationary pressures are imminent.  She additional says that the revised coverage hall already guides short-term charges near the MPR, limiting the necessity for rapid coverage motion.

In the meantime, one other set of analysts is looking for aggressive easing (as much as 200bps). On Nairametrics’ “Drinks and Mics,” Rencap Asset Administration’s Arnold Dublin-Inexperienced and Nairametrics CEO Ugodre Obi-Chukwu argue that MPC ought to lower charges by 200bps, pointing to reducing yields throughout fixed-income devices, decrease inflation, and improved macro stability.

However Right here Is the Actual Concern: Financial Coverage Can not Repair Insecurity

Whatever the MPC’s determination, whether or not it cuts by 50bps, 200bps, or holds, Nigeria’s largest inflationary risk stays structural insecurity. Three details are simple:

1. Over 60 p.c of Nigeria’s inflation is pushed by meals inflation

2. Meals inflation is overwhelmingly pushed by insecurity in farming communities.

3. No financial coverage software like MPR, CRR, OMO, or interest-rate hall can resolve insecurity.

Till Nigeria secures its food-producing areas:

–       Farmers will avoid farmlands.

–       Meals provide will stay insufficient.

–       Transport prices will stay elevated.

–       Market costs will proceed to rise.

–       Inflation will stay structurally excessive.

The MPC can solely achieve this a lot with macro instruments. The actual work lies in addressing the insecurity choking Nigeria’s meals provide chain.

What the MPC Should Do In a different way

1. Overtly acknowledge insecurity as a core inflation driver

The MPC should transfer past generic references to “structural challenges” and particularly establish insecurity as the first risk to cost stability.

2. Collaborate with safety companies and governors

Worth stability is unattainable with out coordinated coverage throughout safety, agriculture, and transportation ministries.

3. Suggest federal and state investments in food-producing areas, reminiscent of:

–       Secured farming clusters

–       Navy-protected agro-corridors

–       Subsidised insurance coverage for farmers in high-risk zones

–       Rural street rehabilitation

4. Prioritise credit score schemes for agricultural safety as a result of credit score with out security is meaningless.

5. Strengthen knowledge collaboration

Many inflation-relevant knowledge factors, together with farm output, rural insecurity, and transport disruptions, are exterior the CBN’s conventional purview. It wants deeper knowledge integration with:

–       Ministry of Agriculture

–       Ministry of Inside

–       Safety companies

–       State governments

–       Farmer associations

The MPC Should Combat the Actual Enemy

Nigeria’s enhancing macroeconomic metrics are encouraging, however they shade a deeper disaster. Structural insecurity choking the nation’s meals provide stays because the true enemy of value stability just isn’t financial. The MPC can not proceed to focus solely on rates of interest whereas overlooking the underlying forces driving meals inflation. Till insecurity is tackled, Nigeria will proceed to expertise excessive meals costs, collapsing buying energy, SME closures, persistent inflation, and financial coverage disorganization.

The November assembly gives a historic alternative for the MPC to shift its coverage strategy that recognises insecurity as a macroeconomic disaster, not a safety challenge alone.

Nigeria doesn’t merely have a financial coverage drawback. Nigeria has a meals drawback pushed by insecurity. And till that drawback is solved, macroeconomic features will stay fragile and incomplete.

Blaise, a journalist and PR skilled, writes from Lagos, will be reached by way of: blaise.udunze@gmail.com