March 18, 2026/Coronation Update

Summary

Data released by the National Bureau of Statistics indicates that headline inflation moderated slightly to 15.06% y/y in February 2026 easing by 4 bps from 15.10% y/y in January. This is above our projection of 14.12% as the unexpectedly sharp acceleration in food inflation slowed the pace of disinflation. The marginal easing in the headline index reflects mixed price dynamics across key CPI components, with the moderation in core inflation partly offset by a pronounced uptick in food prices.

On a month-on-month basis, headline inflation increased to 2.01% m/m, reversing the 2.88% deflation recorded in January and signalling renewed monthly price pressure. The rebound in monthly inflation was largely driven by higher food prices and elevated energy costs, suggesting that the deflationary momentum observed in the previous month was temporary rather than indicative of a sustained disinflation trend.

Food Inflation dynamics

Food inflation accelerated sharply to 12.12% y/y in February 2026, up from 8.89% y/y in January, marking a return to double-digit territory. On a month-on-month basis, food inflation printed at 4.69%, reversing the -6.02% deflation in the prior month. The uptick reflects a combination of seasonal supply constraints and structural cost-push factors. From a seasonal perspective, the February number aligns with the lean season of the traditional Nigerian agricultural cycle, during which post-harvest inventories thin out ahead of the next harvest, resulting in tight market supply conditions for staple food items.

Additionally, elevated transportation costs, logistics bottlenecks, and distribution inefficiencies, also exerted upward pressure on food prices. Consequently, we saw price increase across key staples, including beans, carrots, okazi leaf, cassava tuber, crayfish, millet flour, yam flour, snails, ogbono, and cowpeas.

To download full report, click here