Nigeria’s headline inflation resumed its upward trend in March, climbing to 24.23 per cent — a 1.05 per cent increase from the previous month. The latest data released by the National Bureau of Statistics (NBS) indicates that the surge was primarily driven by food and non-alcoholic beverages, which contributed 9.28 per cent to the overall figure.
Interestingly, despite the rise in headline inflation, the report shows a modest relief in food inflation, which dropped from 23.51 per cent in February to 21.79 per cent in March. However, the broader cost of living crisis remains a significant concern for millions of Nigerians.
Households across the country continue to grapple with rising prices, with many families reportedly spending nearly all of their income on food. A recent study by SEID highlighted that approximately 50 per cent of the population allocates the majority of their earnings to feeding alone — leaving little room for essentials like education, healthcare, and savings.
Last year, the Central Bank of Nigeria (CBN) reported that food consumed over 55 per cent of household budgets, underlining the widespread financial strain. The past decade has seen inflation soar from a single-digit rate of eight per cent in 2014 to nearly 35 per cent before the Consumer Price Index (CPI) was rebased by the NBS.
In response to evolving consumption patterns, the NBS adjusted the CPI last October, aiming to better reflect current realities. Following this adjustment, inflation briefly cooled to 24.48 per cent in January before creeping up again.
Commenting on the development, Professor Godwin Oyedokun, a financial expert, expressed concerns over the sustainability of the temporary slowdown witnessed earlier in the year. He identified key drivers of inflation, including currency instability, insecurity in agricultural regions, transportation costs, and high interest rates.
“While fuel prices may be decreasing, transportation costs remain high. This can keep prices elevated for goods and services, impacting overall inflation,” he explained.
Professor Oyedokun also pointed out that the Central Bank’s interest rate of 27.5 per cent poses challenges to economic growth, as it raises borrowing costs, discouraging both investment and consumer spending.
Meanwhile, Eze Onyekpere, Lead Director of the Centre for Social Justice (CSJ), noted that while there have been isolated reductions in the prices of some goods, the perceived easing of inflation has not been sufficiently deep or widespread to offer meaningful relief to most citizens.
As Nigeria continues to navigate its economic challenges, analysts suggest that only a multi-faceted approach addressing both monetary and structural issues will be capable of curbing inflation and improving living standards.
