Inflation rate in Nigeria decreases for the second consecutive month due to currency stability.
The latest data from the National Bureau of Statistics (NBS) reveals a moderating trend in Nigeria's inflation rate, with the headline inflation dropping to 22.97% in May 2025, down from 23.71% in April.[1][2][3] This represents a decrease of 0.74 percentage points.
On a year-on-year basis, this is a significant improvement from May 2024, when inflation was recorded at 33.95%, marking a 10.98 percentage point decrease.[1][3] Month-on-month inflation also slowed, with the headline rate at 1.53% in May, down from 1.86% in April.[1][3]
However, inflation remains persistently high in double digits, primarily driven by food prices, accommodation, and transport services. Food inflation specifically increased slightly month-on-month to 2.19% in May (up from 2.06% in April), while the year-on-year food inflation rate stood at 21.14%.[1]
Experts have highlighted ongoing challenges, including persistent high inflation, recent security disruptions, and widespread flooding that has affected agriculture and commerce, raising concerns about future inflationary pressures, especially in the food sector.[4]
The Central Bank of Nigeria kept its benchmark interest rate unchanged at 27.50% in May, marking a second consecutive hold by policymakers.[5] The relative exchange rate stability and moderating fuel prices contributed to the inflation moderation.[6]
Dumebi Oluwole, Senior Economist at Stears, attributes the tight monetary environment and anchored exchange rate expectations as playing a critical role in the inflation slowdown.[7] Olajide Oyadeyi of EconoDay stated that January's CPI rebasing created favorable base effects.[8]
Despite these positive signs, the broader economic environment (driven by security, climate, and fiscal factors) suggests that inflation is likely to remain elevated by global standards, and continued vigilance is needed to sustain the current downward trend.[4]
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[1] National Bureau of Statistics (NBS) [2] Headline inflation rate [3] May 2025 and April 2025 inflation rates [4] Expert analysis [5] Central Bank of Nigeria [6] Relative exchange rate stability and moderating fuel prices [7] Dumebi Oluwole, Senior Economist at Stears [8] Olajide Oyadeyi of EconoDay [9] The Moonshot event by our website
Businesses might be encouraged by the moderating trend in Nigeria's inflation rate, as indicated by the latest data from the National Bureau of Statistics (NBS). However, the ongoing challenges such as persistent high inflation, security disruptions, and flooding could have future impacts on businesses, specifically the food sector.
