Nigeria Inflation Falls to 14.63%, Its Lowest Since 2025, but Living Costs Still Bite

Nigeria inflation slowed to 14.63% in September 2026, the lowest headline rate since 2025, according to data from the National Bureau of Statistics (NBS). Yet the slowdown has not translated into relief at the market stall. As BusinessDay reported on October 16, many households say prices remain well above what their incomes can cover.

The gap between the statistic and daily experience comes down to one point. Lower inflation means prices are rising more slowly. It does not mean prices are falling.

What the September Nigeria inflation data shows

The NBS figures, also reported by Technext, show a broad easing:

• Headline inflation fell to 14.63% from 15.39% in August, a drop of 0.76 percentage points.
• A year earlier, in September 2025, headline inflation stood at 20.98%. The annual decline is 6.35 percentage points.
• Month-on-month inflation slowed to 0.06%, from 0.71% in August.
• Core inflation, which strips out farm produce and energy, eased to 12.95% from 13.29%.

The month-on-month figure is the most striking. At 0.06%, the general price level barely moved between August and September.

Food remains the sore point

Food inflation tells a different story. On a year-on-year basis, it edged up to 19.59% in September from 19.57% in August. It was 20.16% a year earlier, so the annual improvement is modest.

Month on month, food prices actually fell 1.55% in September, after rising 1.02% in August. That monthly dip may reflect harvest-season supply. But because food takes the largest share of spending for most Nigerian households, an annual food inflation rate near 20% is what people feel most.

Why households are not feeling relief

BusinessDay's reporters, Oluwatobi Ojabello and Wasiu Alli, spoke to consumers who say their spending power has not recovered. The reason is cumulative. Prices that climbed during earlier years of high inflation have stayed at those higher levels. A slower rate of increase now is added on top of that higher base.

Many workers' wages have not kept pace with that accumulated rise. So even with headline inflation down by more than six points in a year, the cost of a basket of food, transport and rent remains far above where it was a few years ago.

Reading the annual and monthly numbers

The year-on-year rate compares prices with the same month last year, so it moves slowly and carries the weight of past increases. The month-on-month rate is a cleaner read of current price pressure. On that measure, September was calm, while food prices on an annual basis were not.

What it means for interest rates

The Central Bank of Nigeria (CBN) has already started to respond. In September, its Monetary Policy Committee cut the Monetary Policy Rate (MPR) from 26.5% to 23%, according to Nairametrics. The CBN has said it is aiming for single-digit inflation over the medium term.

Another month of easing gives the committee room to consider further cuts. Lower rates would reduce borrowing costs for businesses and government. Yields on government securities have already been moving lower, as seen in the latest DMO auction, where the 364-day stop rate fell despite strong demand.

The risk of moving too fast

The case for caution rests on food. With food inflation still close to 20%, policymakers will want to see whether the September monthly decline holds once the harvest effect fades. Exchange rate stability and fuel prices will also shape the next readings.

What investors and businesses should watch

• The October CPI release, to see whether month-on-month inflation stays near zero
• Food inflation after the harvest season ends
• The CBN's next MPC decision and any guidance on the pace of rate cuts
• Treasury bill and bond yields, which tend to move ahead of policy changes

For fixed-income investors, falling inflation and a rate-cutting central bank point to lower yields ahead. For consumer-facing businesses, the more useful signal is food prices, since that is where household budgets are still under the most strain.

September's data confirms that Nigeria inflation is on a downward path. Turning that into a lower cost of living will take a longer run of stable prices and stronger wage growth than the numbers show so far.