May 15, 2026/InvestmentOne Report

The National Bureau of Statistics (NBS) reported that headline inflation climbed to 15.69% in April 2026, 31bps higher than the 15.38% recorded in the previous month. The uptick in the annual rate, however, masks a significant deceleration in the pace of monthly price increases, with month-on-month headline inflation declining sharply to 2.13% from 4.18% in March, a 205bps moderation.

This suggests that while base effects continue to push the annual figure modestly higher, the acute energy-driven price shock that characterized March appears to be decelerating at a steady rate. 

Looking ahead, we expect inflationary dynamics to remain mixed in the near term. However, we do not anticipate a rapid or sustained disinflation trajectory in the absence of a meaningful de-escalation in the Middle East conflict, which continues to weigh on global energy supply through its impact on the Strait of Hormuz. Domestically, food prices remain structurally challenged, with the rural-urban inflation divergence underscoring persistent supply-side bottlenecks in agricultural producing regions.

On the monetary policy front, the persistence of headline inflation above 15% is likely to sustain the central bank’s broadly hawkish posture, with material rate cuts remaining unlikely in the immediate term.

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