Analysts Project Further Decline In Inflation Rate On Improved Food Supply

Nigeria’s ostentation outlook is expected to amended successful the coming months, buoyed by accrued nutrient proviso from the ongoing harvest play and improved stableness successful the Nigerian overseas speech market.
Coronation Merchant Bank, successful its latest Inflation Outlook for August, projected that header ostentation volition easiness to 21.45 per cent year-on-year successful August from 21.88 per cent recorded successful July, portion month-on-month ostentation is expected to mean somewhat to 1.74 per cent.

Inflation has declined aft a flimsy emergence successful March this twelvemonth declining to 22.97 per cent successful May, 22.22 per cent successful June earlier printing 21.88 per cent successful July. The National Bureau of Statistics (NBS) is expected to merchandise the August ostentation figures this week up of the Monetary Policy Committee Meeting connected September 22-23, 2025.

The Coronation Merchant Bank study pointed retired that aboriginal harvests of staple crops specified arsenic maize, groundnuts, pumpkins and vegetables, peculiarly successful the confederate and middle-belt regions, person helped to soften nutrient prices. This development, according to Coronation, volition lend importantly to reducing pressures connected the nutrient handbasket which remains the large operator of inflation.

The outlook besides highlighted the relation of speech complaint stableness successful supporting disinflation. With the naira closing astatine astir N1,531.57 to the dollar successful August, reflecting a mild appreciation, the outgo of imported nutrient items is expected to ease. Stability successful the overseas speech marketplace is moderating the outgo of processed and packaged foods, providing further alleviation to consumers, Coronation stated.

Energy costs, which person weighed heavy connected accumulation and transportation, were besides observed to person moderated successful the play nether review. This, coupled with stronger overseas speech liquidity backed by rising outer reserves, up by astir $1.91 cardinal to $41.27 billion, has further strengthened the Central Bank’s quality to negociate marketplace pressures.

Coronation noted that dependable portfolio inflows person reinforced marketplace confidence, a origin expected to prolong the comparative calm successful the FX market.
However, the study cautioned that a fewer risks could dilatory down the gait of disinflation.

It drew attraction to the brewing disagreement betwixt Dangote Refinery and the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) implicit unionisation of drivers, informing that immoderate disruption successful substance proviso could trigger higher proscription and accumulation costs. Seasonal flooding, already opening successful parts of the country, was besides identified arsenic a menace to nutrient proviso and organisation channels.

The study maintained that the outlook for September is mostly affirmative if existent conditions persist. “If beardown FX stability, rising reserves and abundant nutrient from harvests continue, ostentation for September is apt to stay broadly successful enactment with August levels,” the slope noted, though it warned that the magnitude of the diminution whitethorn beryllium modest.