April 16, 2026/Cordros Report
The National Bureau of Statistics released its inflation report for the month of March. According to the NBS, headline inflation rose by 32bps to 15.38% y/y in March (February: 15.06% y/y), marking the first increase since March 2025. A disaggregation of the data shows that inflation increased across both the food (+219bps to 14.31% y/y vs February: 12.12% y/y) and core (+33bps to 16.21% y/y vs February: 15.88% y/y) components, primarily reflecting the pass-through effects of elevated energy prices on overall price levels. On a month-on-month basis, consumer prices increased markedly by 4.18% in March (February: 2.01% m/m), extending last month’s positive reading.
On a month-on-month basis, food prices increased by 4.12% in March (February: +4.70% m/m), resulting in a rise in the year-on-year rate to 14.31% y/y (February: 12.12% y/y). We attribute the sustained upward pressure on food prices to constrained supply conditions during the ongoing planting season, alongside elevated logistics costs driven by the spike in energy prices. Within the food basket, farm produce prices accelerated to 4.60% m/m (February: +3.74% m/m), while imported food prices also recorded a notable increase of 1.12% m/m (February: +0.65% m/m).
At the same time, core inflation rose markedly by 4.03% m/m (February: +0.89% m/m), pushing the year-on-year rate to 16.21%. We attribute the increase to the impact of the spike in fuel prices on transportation and business costs. Across the subcomponents, inflationary pressures heightened significantly in restaurants and accommodation services (+6.92% m/m vs February: +1.12% m/m), personal care (+5.21% m/m vs February: +0.34% m/m), utilities (+4.07% m/m vs February: –0.45% m/m), transport (+3.98% m/m vs February: -0.26% m/m) and health (+2.86% m/m vs February: -0.22% m/m).
Short-term Relief in Sight, but Inflation Not Yet Tamed
Following a spike in March, price pressures have now begun to ease gradually due to a slower pace of increase in energy prices. Precisely, the recent fragile ceasefire in the Middle East has contributed to a moderation in global oil prices from their recent peaks. The Brent crude price has fallen by 19.8% to USD94.90/barrel as of April 15th (March 30: USD118.35/barrel). Domestically, this decline has translated into a noticeable slowdown in domestic energy price increases, with pump prices for petrol and diesel stabilising after earlier sharp rises linked to global benchmarks in March. Although transportation and business costs have remained high, the pass-through of earlier energy shocks to consumer prices is beginning to soften, reducing the pace of increase in food and core inflation.
Most importantly, the naira has remained relatively stable, averaging NGN1,366.91/USD so far in April (March: NGN1,379.13/USD). This stability has helped contain imported inflation despite lingering global shipping cost pressures linked to Middle East tensions, thereby keeping inflation expectations partially anchored.
That said, while a near term moderation in price pressures is expected, overall price levels remain elevated, and risks are still skewed to the upside. We note that the ceasefire in the Middle East remains fluid, raising the possibility of renewed geopolitical tensions that could rebound global oil prices and re-intensify pressure on domestic energy, transport, and operating costs. In addition, food supply conditions are likely to stay tight despite the onset of the off-season (irrigated) harvest in the northern region in April, as heightened insecurity continues to disrupt agricultural production and distribution.
Overall, we forecast inflation to ease to 2.0% m/m from 4.18% m/m in April. However, inflation is estimated to rise further to 15.54% y/y (March: 15.38% y/y).
