Nigeria’s headline moderated to 21.88 per cent year-on-year in July as the harvest season kicked in.
According to analysts at FBNQuest, the easing in July’s inflation reading, driven by a high base effect and improved stability across key inflationary drivers.
The headline inflation rate moderated to 21.88 per cent year-over-year in July, down from 22.22 per cent recorded in June.
The month-on-month readings have remained relatively sticky. This suggests that underlying price pressures persist, indicating that inflationary risks have not been fully neutralised.
On a month-on-month basis, Headline increased by 1.99 per cent in July, compared with 1.68 per cent the previous month.
The continued pressure on monthly price levels is primarily driven by disruptions in the food supply chain, which stem from persistent security challenges across key agricultural regions.
However, core inflation and food inflation dropped to 0.97 per cent, up from 3.12 per cent in July.
The report showed that at the divisional level, the three major contributors to the headline inflation were Food and non-alcoholic Beverages: 8.75 percent, Restaurants & Accommodation Services: 2.83 percent, and Transport: 2.33 percent; while the least contributors were Recreation, Sport, and Culture: 0.07 percent, Alcoholic Beverages, Tobacco, and Narcotics: 0.08 percent, and Insurance and Financial Services: 0.10.
Core inflation, which excludes the prices of volatile agricultural produce and energy, stood at 21.33 percent in July 2025 on a year-on-year basis. On a month-on-month basis, the core inflation rate was 0.97 percent in July 2025, down by 1.49 percentage points from 2.46 recorded in June 2025.
With the newly introduced indices, the inflation rate of the sub-indices for July 2025 shows that Farm Produce (3.96 percent), Energy (2.71 percent) and Goods (2.72 percent) increased significantly, and their index were 128.5, 121.2 and 124.6 basis points; respectively. Conversely, Services recorded decline during the month to 0.47 percent.
“On a year-on-year basis, the urban inflation rate in July 2025 was 22.01 percent. On a month-on-month basis, the urban inflation rate was 1.86 percent in July 2025, fell by 0.25 percent compared to June 2025 (2.11 percent).
“The rural inflation rate in July 2025 was 21.08 percent on a year-on-year basis. On a month-on-month basis, the rural inflation rate in July 2025 was 2.30 percent, increased by 1.67 percent compared to June 2025 (0.63 percent)
State-level analyses of the food index in July 2025, Food inflation on a Year-on-Year basis was highest in Borno (55.56 percent), Osun (29.10 percent), Ebonyi (29.06 percent), while Katsina (6.61 percent), Adamawa (9.90 percent), and Zamfara (14.72 percent) recorded the slowest rise in Food inflation on a Year-on-Year basis.
On a Month-on-Month basis, however, July 2025 Food inflation was highest in Borno (10.89 percent), Kano (10.86 percent), and Sokoto (7.43 percent), while Zamfara (-6.00 percent), Bauchi (-2.18 percent) and Abia (-1.06 percent), recorded decline in Food inflation on Month-on-Month basis.
