SAT AUG 16 2025-theGBJournal| Nigeria’s headline inflation eased by 34bps to 21.88% y/y in July (June: 22.22% y/y), the National Bureau of Statistics reported on Friday.
Core inflation also dropped to 21.33% from 22.76% in June, a 1.43% decline.In contrast, food inflation rose to 22.74% from 21.97% in June, an increase of 0.77%.
Month-on-month, headline inflation increased by 0.31% to 1.99% from 1.68% in June.
Food inflation declined by 0.13% to 3.12% from 3.25% in June, while core inflation posted a significant drop to 0.97%, down from 2.46% in June 2025.
The year-on-year decline in headline inflation for July 2025 is partly attributable to base effects, as 2024 recorded elevated inflation levels.
Following the rebasing, headline inflation has trended downward in most months, with the only exception being March 2025, which registered a marginal uptick. However, the month-on-month (MoM) dynamics reveal a more complex picture.
Inflation in July 2025 stood at 1.99% MoM compared to 2.28% in July2024, indicating that the moderation in headline inflation cannot be explained by base effects alone. This points to a gradual improvement in underlying price stability.
In July 2025, headline inflation rose on a MoM basis, while both core and food inflation declined.
This divergence reflects the impact of higher energy costs, which are excluded from both core and food inflation measures.
Data from the National Bureau of Statistics (NBS)show that the energy inflation index rose 2.7% MoM in July 2025, reversing the -11%recorded in June.
This sharp rebound in energy prices fed directly into MoM inflation, offsetting the disinflationary momentum from core and food inflation.
Core inflation posted a significant year-on-year decline of 1.43% and a month-on-month decline of 1.49%, underscoring the easing of underlying inflationary pressures.
As core inflation excludes volatile items such as food and energy, its sustained moderation indicates that structural cost pressures such as input prices, supply chain constraints, and domestic demand imbalances are beginning to ease.
This trend supports a more stable macro economic environment and suggests that the current disinflation is not purely cyclical but anchored in improving fundamental cost dynamics.
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