Nigeria’s headline inflation rate fell for the fifth consecutive month in August, easing to 20.12 per cent from 21.88 per cent in July. The National Bureau of Statistics (NBS) described the development as evidence of moderating price growth, but households, small businesses, and private sector leaders insist that the decline has not translated into relief.
According to the NBS Consumer Price Index released on Monday, inflation slowed by 1.76 percentage points month-on-month and dropped sharply from 32.15 per cent recorded in August 2024. The CPI rose slightly to 126.8 points in August from 125.9 in July, while month-on-month inflation was 0.74 per cent, down from 1.99 per cent in July.
Urban inflation eased to 19.75 per cent in August compared with 34.58 per cent a year earlier, while rural inflation stood higher at 20.28 per cent against 29.95 per cent in August 2024. On a monthly basis, urban inflation slowed to 0.49 per cent, while rural inflation was 1.38 per cent. Analysts noted that rural areas remain more vulnerable due to insecurity, high transport costs, and supply chain disruptions.
Food inflation, the biggest driver of Nigeria’s inflation basket, also moderated to 21.87 per cent in August from 37.52 per cent a year ago. Month-on-month, it dropped to 1.65 per cent from 3.12 per cent in July, with falling prices of rice, maize flour, millet, semolina, and soya milk contributing to the decline. Yet, food prices remain elevated, particularly in northern states battling insecurity and poor logistics.
Core inflation, which strips out volatile food and energy prices, slowed year-on-year to 20.33 per cent from 27.58 per cent in August 2024. But on a monthly basis, it rose to 1.43 per cent from 0.97 per cent, reflecting pressure from housing, energy, transport, education, and healthcare.
Across the states, disparities were wide. Ekiti recorded the highest headline inflation at 28.17 per cent, followed by Kano at 27.27 per cent. Zamfara posted the lowest at 11.82 per cent. For food inflation, Borno led at 36.67 per cent, while Zamfara recorded the lowest at 3.30 per cent.
Despite the statistical slowdown, many Nigerians say they are not feeling the impact. Leaders of small business associations stressed that the easing figures mean little when market realities remain unchanged.
The head of the Association of Small Business Owners of Nigeria said that while falling inflation looks positive on paper, it has little effect on everyday livelihoods. He urged the government to cushion businesses and households with social safety nets, food access, and transport support, warning that the MSME sector—which employs more than 80 per cent of the workforce—risks collapse.
Similarly, the Director-General of the Nigerian Association of Small and Medium Enterprises said inflation figures do not reflect realities in the market. “One could take ₦50,000 to the market and exhaust it without buying everything,” he lamented, noting that businesses are cutting raw material purchases and investment due to weak demand.
The Lagos Chamber of Commerce and Industry pointed out that falling inflation does not mean falling prices. “Prices will only come down when supply significantly increases,” its president explained. Leaders of small-scale industrialists added that once prices rise, they rarely drop, as producers prefer to retain margins unless competition forces a cut.
The Centre for the Promotion of Private Enterprise described the decline as encouraging but cautioned that government must directly tackle food costs and insecurity to make a real difference.
Economic experts agreed that while disinflation signals macroeconomic stability, it does not erase household strain. Analysts noted that demand is shrinking, foreign reserves have improved, and the naira has strengthened, but structural bottlenecks such as power shortages, high logistics costs, and import dependency still weigh heavily on prices.
They stressed that inflation figures must be understood as aggregates, with some prices falling while others remain sticky. Seasonal patterns also influence the data: food costs rise during pre-harvest and ease post-harvest but often remain higher than the previous year.
The inflation report arrives days before the Central Bank of Nigeria’s Monetary Policy Committee meeting on September 22–23. While the five-month easing trend offers some room for flexibility, persistent food and core inflation may push the CBN to maintain its benchmark interest rate at 27.5 per cent.
Nigeria’s inflation remains among the highest in Africa despite recent moderation. While the numbers offer a glimmer of hope for policymakers, the lived reality for millions of households and small businesses is starkly different.
SMEs, which account for 96 per cent of businesses and drive job creation, continue to struggle with high input costs, weak consumer demand, and declining profit margins. Until government tackles structural constraints insecurity, poor infrastructure, logistics inefficiencies, and unreliable power the gap between statistical improvements and everyday survival will persist.
For now, inflation may be easing on paper, but for businesses and families across Nigeria, survival remains an uphill battle.
