Inflation still high despite latest decline, OPS warns

Nigeria’s headline inflation rate eased marginally to 15.91 per cent in June 2026 from 15.93 per cent recorded in May, according to the latest Consumer Price Index report released by the National Bureau of Statistics on Wednesday.

Members of the organised private sector welcomed the slight decline in the inflation rate for June 2026 but warned that inflation remained in double digits and prices were still too high for businesses and consumers.

The NBS report showed that although the annual inflation rate continued its downward trend, food prices rose at a faster month-on-month pace, driven by increases in the prices of fresh pepper, tomatoes, crayfish, beef, garri, yams, and other staple food items.

According to the NBS, “In June 2026, the Headline inflation rate was 15.91 per cent, down from 15.93 per cent in May 2026 and stood at 25.29 per cent in the same month of the preceding year (June 2025). Looking at the movement, the June 2026 Headline inflation rate showed a decrease of 0.02 per cent compared to the May 2026 Headline inflation rate.”

The bureau also said the Consumer Price Index increased to 143.0 in June from 140.7 in May, reflecting a 2.3-point increase over the previous month. On a month-on-month basis, headline inflation slowed to 1.66 per cent in June from 1.75 per cent in May.

The report stated, “This means that in June 2026, the rate of increase in the average price level was lower than the rate of increase in the average price level in May 2026.”

The PidomNigeria observed that the current inflation rate marked its first decline after three consecutive monthly increases, from 15.06 per cent in February to 15.38 per cent in March, 15.69 per cent in April, and 15.93 per cent in May.

The slowdown came despite concerns that higher global crude oil prices triggered by the US-Iran conflict could fuel further inflationary pressures through increased fuel, transport and food costs, especially as the geopolitical tensions persist.

OPS reacts

Reacting to the figures, the President of the Lagos Chamber of Commerce and Industry, Leye Kupoluyi, described the moderation as positive for the economy but said Nigeria still had a long way to go in achieving price stability.

“When inflation goes down, it’s for the benefit of the consumer. The consumer is you and me, every one of us. Therefore, it is what we all look forward to in any society. When inflation comes to a single unit, or even at less than one per cent, that is what we call stability. Therefore, if inflation is going down in Nigeria, no doubt, it’s good news for everyone, government, industry, and the consumer,” Kupoluyi said.

He added that recent economic indicators were encouraging and expressed optimism that the trend would continue. “We are seeing stability in Nigeria, and what is coming out in terms of figures and statistics is encouraging. We are looking forward to it,” the LCCI president remarked.

Also commenting, the President of the Association of Small Business Owners of Nigeria, Dr Femi Egbesola, attributed the slight decline in inflation largely to seasonal factors, lower energy costs, and manufacturers’ increased use of locally sourced raw materials.

“I think food and agriculture have been one of the major drivers of inflation, and this time we are in the rainy season, where we have more food, which means more supply than demand and naturally drives down prices. Energy costs have also come down marginally, while many manufacturing companies are beginning to reap the fruits of backward integration by replacing imported inputs with locally produced raw materials,” Egbesola said.

However, the ASBON chief cautioned that the current trend might not be sustainable if it were driven mainly by seasonal conditions.

“My concern is whether the government will be able to sustain this. If the reason for the drop in inflation is not strategic but seasonal or based on unstructured indices, then it will not be sustainable. The government should be thinking about how to sustain this by supporting agriculture all year round, improving irrigation, and ensuring stable electricity beyond the rainy season,” Egbesola said.

Meanwhile, the Director-General of the Nigerian Association of Small and Medium Enterprises, Eke Ubiji, disagreed with suggestions that prices were stabilising, insisting that inflation remained high despite the marginal decline.

“Things are not stabilising. Inflation remains very high. We use market intelligence to know what is happening, not theories. People who go to buy things will tell you the truth. Food is even the first casualty. People have been complaining since the beginning of the year, and this is already the seventh month. If there was any real stabilisation, you would have seen it by now,” Ubiji said.

According to the NBS, food inflation stood at 17.52 per cent year-on-year in June, while month-on-month food inflation accelerated to 3.75 per cent from 2.98 per cent in May due to higher prices of fresh pepper, tomatoes, crayfish, beef, garri, yams, and other staple food items.

Further analysis

An analysis of the inflation components showed that food and non-alcoholic beverages remained the largest contributor to headline inflation at 6.37 percentage points.

Restaurants and accommodation services contributed 2.06 percentage points, transport accounted for 1.70 percentage points, while housing, water, electricity, gas, and other fuels added 1.34 percentage points. Education services contributed 0.99 percentage points, while health accounted for 0.96 percentage points.

Food inflation stood at 17.52 per cent year-on-year in June, compared with 25.41 per cent in the corresponding period of 2025. However, on a month-on-month basis, food inflation accelerated to 3.75 per cent from 2.98 per cent recorded in May.

The NBS attributed the increase to higher prices of several food commodities. It said, “This can be attributed to the rate of change in the average prices of the following products: Crayfish, Pepper (Fresh), Tomatoes (Fresh), Green Peas (dried), Fresh Pepper, Yam Flour (Sold loose), Water Yam, Beef, Banana, Cassava Flour, Cow Pea, Garri, Irish Potatoes, Yam Tuber, etc.”

Core inflation, which excludes the prices of volatile agricultural produce and energy, fell to 15.92 per cent year-on-year in June from 25.41 per cent recorded in June 2025. On a month-on-month basis, core inflation slowed to 1.66 per cent from 1.94 per cent in May.

The report also showed that the average headline inflation rate for the 12 months ending June 2026 stood at 17.63 per cent, down from 29.82 per cent recorded in June 2025. Similarly, the average annual food inflation rate declined to 16.42 per cent from 31.93 per cent in the corresponding period of the previous year.

The urban inflation rate was 16.08 per cent year-on-year, while the rural inflation rate stood at 15.48 per cent. On a month-on-month basis, urban inflation rose to 2.13 per cent from 1.99 per cent, while rural inflation slowed to 0.52 per cent from 1.17 per cent recorded in May.

Across the states, Niger recorded the highest annual all-items inflation rate at 42.23 per cent, followed by Kogi at 41.59 per cent and the Federal Capital Territory at 39.91 per cent. Imo recorded the lowest annual inflation rate at 19.47 per cent, followed by Ebonyi at 20.79 per cent and Katsina at 21.87 per cent.

For food inflation, Kogi posted the highest year-on-year rate at 53.02 per cent, followed by Niger at 43.83 per cent and Benue at 40.83 per cent. Katsina recorded the lowest food inflation rate at 19.15 per cent, while Rivers and Imo posted 23.81 per cent and 24.60 per cent, respectively.