Nigeria’s disinflation trend continued in July as headline inflation dropped to 21.88%, down from 22.22% in June. The moderation came from a sharp fall in core inflation to 21.33%, despite food inflation climbing to 22.74%. Since rebasing, inflation has now eased by 260bps.

Food Prices Slow Down

On a monthly basis, food inflation growth slowed to 3.12% compared to 3.25% in June. Lower staple prices and slower growth in imported food costs, supported by naira stability, contributed to this moderation.

Real Interest Rates Turn Attractive

Nigeria’s real interest rate widened to 5.62%, its highest so far in 2025. Positive returns combined with a stable currency may draw foreign investors and stimulate fresh capital inflows.

Regional Disparities Persist

Inflation patterns remain uneven across states. Yobe and Katsina recorded the lowest headline and food inflation rates at 6.21% and 9.90% respectively. Meanwhile, many states continue to face entrenched monthly price pressures, particularly beyond energy-related categories.

What to Expect Next

In August, disinflation is likely to persist, supported by stable exchange rates, lower PMS prices, and steady foreign reserve growth. However, risks remain from global oil price volatility, climate-related food supply shocks, and Nigeria’s reliance on imports.

Download the full July Inflation Report below for deeper insights, risks, and state-by-state dynamics.

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