Ramadan demand pushes monthly prices higher as Nigeria’s inflation slips to 15.06%

NIGERIA’S headline inflation recorded a slight decline to 15.06 percent year-on-year (YoY) in February 2026, although a sharp increase in the month-on-month (MoM) rate to 2.01 percent indicates renewed short-term price pressures. The rise in monthly inflation has been linked largely to Ramadan-related demand, as households increase purchases of food items while farming activities slow.

Figures released by the National Bureau of Statistics (NBS) show that the Consumer Price Index (CPI) fell marginally to 15.06 percent in February, down from 15.10 percent in January, suggesting only a modest improvement in the annual inflation rate.

While the year-on-year figure declined slightly, monthly inflation moved in the opposite direction. Headline inflation rose to 2.01 percent in February, reversing the –2.88 percent recorded in the previous month, highlighting stronger price increases across several categories.

A breakdown of the inflation components shows that both food and core prices rose during the month. Food inflation increased to 4.69 percent, while core inflation climbed to 0.89 percent, compared with –6.02 percent and –1.69 percent respectively in January.

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The increase in food prices was largely attributed to seasonal demand during Ramadan. Higher household stockpiling and reduced farming activities tightened supply conditions, contributing to the rise in staple food prices.

Meristem Securities noted that early bulk purchases by households combined with slower agricultural activity typically drive up the prices of essential food items and add pressure to monthly inflation.

Data from Meristem’s commodity price tracker indicates that the cost of several staples has begun to rise again after months of decline. Prices of maize and sorghum, which had previously been trending downward, have reversed course, while paddy rice and soybeans recorded more pronounced increases.

Despite the marginal easing in the annual inflation rate, the outcome fell below expectations from some analysts who had projected a sharper decline to the 13 percent–14 percent range.

Food inflation recorded the strongest monthly increase, rising by 10.70 percent, while core inflation grew by 2.5 percent, reflecting continued pressure on consumer spending.

Even so, analysts say broader inflationary pressures appear to be gradually easing. The moderation is partly supported by relatively stable movements in core prices.

Core inflation impact

According to Meristem Securities, core inflation is expected to continue trending downward on a yearly basis, aided by lower fuel costs and a stronger naira. However, the firm expects the index to stabilise on a month-on-month basis rather than decline significantly.

Fuel costs also eased slightly during the month after the Dangote Refinery reduced its ex-depot price of petrol by N25 per litre, bringing it down to N774 from N799 in January. The price adjustment could help moderate transportation and energy costs, which are key components of the core inflation index.

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However, things have changed since then globally, with the U.S.-Iran war rattling markets. The cost of a litre of fuel has hit N1,230 – N1,400 across Nigeria as Iran blocks the Strait of Hormuz, the narrow waterways though which 20 percent of oil moves to various markets. Brent, the global oil benchmark, stood at $102.1 per barrel, while WTI was priced at $95.35 as at 4.30pm Nigerian time.

Meanwhile, the naira strengthened by 4.32 percent month-on-month in February, averaging N1,355.34 per dollar at the official market compared with N1,416.52 per dollar in January, providing additional support for moderating inflationary pressures.