Raphael Kanu
The National Bureau of Statistics (NBS) has reported a drop in Nigeria’s headline inflation rate to 21.88% in July 2025, down from 22.22% in June. This marks the fourth consecutive monthly decline in inflation this year.
According to the NBS Consumer Price Index (CPI) report released on Friday, the July figure reflects a 0.34% decrease compared to June. On a yearly basis, inflation was 11.52% lower than in July 2024, when it stood at 33.40%.
However, the report noted that on a month-on-month basis, prices rose faster in July than in June. The monthly inflation rate climbed to 1.99% in July from 1.68% in June, indicating a quicker pace of price increases.
The main contributors to July’s CPI were food and non-alcoholic beverages, restaurants and accommodation services, and transport.
Economists describe this as a mixed signal for Nigeria’s economy. The drop in annual inflation suggests that price pressures over the past year are easing, possibly reflecting tighter monetary policy, adjustments in import restrictions, and improved foreign exchange liquidity. It also indicates that the inflation surge of 2024 is cooling.
Yet, the rise in monthly inflation points to lingering cost pressures, meaning consumers are still facing higher prices at a faster rate. For many households, especially those on low and fixed incomes, this undermines any perceived relief from falling annual figures. Persistent supply challenges, high logistics costs from elevated fuel prices, and rising service-sector costs continue to drive up expenses.
Analysts warn that while Nigeria is in a disinflation phase — where prices are still rising but at a slower annual pace — the acceleration in monthly price growth could reverse the gains if not carefully managed. Policymakers are urged to maintain a balance between interest rate control, currency stability, and boosting domestic production, especially in agriculture, to prevent a renewed inflation spike.