Image Credit: Futureview
August 17, 2026/Futureview Report
The National Bureau of Statistics (NBS) reported that the Consumer Price Index (CPI) increased to 145.3 in July 2026 from 143.0 in June, while headline inflation moderated to 15.43% from 15.91%, reflecting a 0.48% decline.
On a year-on-year basis, inflation also declined significantly by 9.51% from 24.94% in July 2025. The moderation was supported by a slower increase in causal prices, particularly core inflation, although food prices remained a major source of pressure.
Food Inflation declined to 20.31% on a year-on-year basis in July 2026, down from 26.20% recorded in July 2025. However, on a month-on-month basis, it accelerated to 5.56% from 3.75% in June due to a surge in prices of staples including crayfish, fresh pepper, onions, carrots, rice, water yam, tomatoes, garri, plantain, beef, eggs and ginger. The sustained increase suggests that food prices remain vulnerable to supply constraints and higher distribution costs. Core Inflation, which excludes volatile agricultural produce and energy, eased further to 14.97% on a year-on-year basis from 23.95% in July 2025. On a month-on-month basis, core inflation declined significantly to 0.15% from 1.66% in June, indicating a much slower increase in non-food prices, as broader price pressures in the economy are gradually easing.
When segmented, Urban Inflation dropped to 16.12% in July 2026, down from 30.74% recorded in July 2025. Meanwhile, Rural Inflation stood at 13.77%, compared to 27.05% in July 2025, showing that the decline in inflation was evident across both urban and rural areas.
All Items Inflation
The highest all-items inflation rates were recorded in Adamawa (33.03%), Yobe (25.21%), and Anambra (23.99%), while Nasarawa (7.86%), Kebbi (9.12%), and Borno (9.12%) recorded the lowest increases. On a month-on-month basis, inflation pressures were highest in Adamawa (12.48%), Anambra (9.95%), and Delta (9.54%), whereas Niger (-5.86%), Enugu (-5.71%), and Kebbi (-4.89%) recorded the lowest monthly readings.
Food Inflation
Food inflation was highest in Adamawa (51.36%), Katsina (30.84%), and Zamfara (30.65%), while Borno (-0.31%), Nasarawa (6.88%), and Kebbi (12.50%) recorded the slowest increases in food prices. On a month-on-month basis, food inflation pressures were highest in Adamawa (17.02%), Lagos (13.48%), and Borno (13.26%), whereas Jigawa (-3.68%), Kebbi (-3.67%), and Bauchi (-1.85%) recorded the slowest changes.
Looking Ahead, the sharp rise in month-on-month food inflation shows that the moderation remains fragile. The CBN’s decision on July 22 to maintain the policy rate at 26.5% suggests that the Bank remains comfortable with its current monetary stance whilst adjusting liquidity conditions. Also, higher crude oil prices
amid continued Middle East tensions continues to add pressure through fuel, transportation and production costs, although the absence of major supply disruptions may limit the immediate impact.
Meanwhile, the approaching 2027 elections is another factor to watch, as increased government and election-related spending could inject more money into the economy and strengthen demand-side inflationary pressures. As such, while easing core inflation provides room for further moderation, persistent food pressures, higher energy costs, liquidity conditions and rising election-related spending could keep broader inflation elevated in the coming months.
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