Inflation Pressure to Resurface, Firm Expects Annual Rate to Ease
Nigeria’s inflation pressure is seen to resurface in October as against the record reading for September 2025 due to key developments in the economy over the month.
On a year-on-year basis, Nigeria’s inflation rate is projected to decline further, with Coronation Merchant Bank Research unit projecting that the consumer price index will settle at 16.29%.
Coronation anticipates the disinflationary trend to persist, albeit at a slower pace, with headline inflation projected to ease to 16.29% year on year from 18.02% year on year on yearin September.
On a month-on-month basis, analysts said they expect a marginal uptick to 1.17%, reflecting cost pressures in core components.
Inflationary pressures are likely to resurface, primarily driven by rising costs within the services, transport, and energy components, Coronation said, which may partly offset the disinflationary impact of improved food supply as the current harvest season tapers off.
Analysts anchored the projection on the recent uptick in petrol motor spirit (PMS) and cooking gas prices, following supply disruptions linked to the PENGASSAN strike, which is expected to keep monthly inflation relatively sticky.
“The anticipated uptick in month-on-month headline inflation is largely driven by movements within the food and core consumer price index (CPI) components.”
On the food side, analysts stated that increased market supply from the waning harvest season has helped ease price pressures on major staples such as grains, tubers, and vegetables.
The firm said the disinflationary impact of this development is being partly offset by elevated core-related costs.
“The core CPI is expected to record an upward movement, reflecting higher transportation fares and household energy costs, following the recent increase in PMS prices from an average of ₦865 to ₦922 per litre and a rise in cooking gas prices from an average of ₦900 per kilogram to ₦1,300 per kilogram.
“These increases, induced by temporary supply disruptions linked to the PENGASSAN strike, have filtered through to both direct energy costs and secondary price effects across the supply chain.
“The exchange rate pass through effects remains moderate, as relative FX stability has helped contain imported inflation. Overall, while food inflation continues to decelerate, sticky core prices are expected to limit the pace of disinflation”.
For November, Coronation Research expects the month-on-month uptick in headline inflation to persist, driven by increased consumer demand as traders restock ahead of the festive season, alongside the risk of artificial fuel scarcity that could trigger an upward adjustment in PMS prices, following the recent 15% levy imposed on imported fuel to discourage importation.
However, government has stopped the implementation of the import tax on petrol, which may reduce the heat around consumer price index.
“Based on our inflation outlook, we expect the Monetary Policy Committee (MPC) to adopt a cautious approach toward easing at its next meeting, given the potential reversal in the month-on-month decline in August and September”, Coronation stated.
The Central Bank of Nigeria (CBN) Governor Yemi Cardoso had emphasized that any decision will remain data driven, guided primarily by inflation and exchange rate dynamics. Nigerian Breweries Falls Below N2trn after Huge Block Trades
