Nigeria’s Inflation Drops To 15.10% in January 2026

News in brief:

-Headline inflation declined to 15.10% year-on-year in January 2026, down from 15.15% in December.

-Food inflation fell sharply to 8.89%, driving overall price moderation.

Nigeria’s inflation rate moderated further in January 2026, with the Consumer Price Index (CPI) declining to 127.4 from 131.2 recorded in December 2025, according to the January 2026 CPI report released by the National Bureau of Statistics (NBS).

Headline inflation eased to 15.10% year-on-year, slightly lower than the 15.15% recorded in December 2025, representing a 0.05 percentage point month-on-month decline. More significantly, inflation is now 12.51 percentage points lower than the 27.61% recorded in January 2025, indicating a substantial deceleration in price pressures over the past year.

On a month-on-month basis, inflation recorded a negative reading of 2.88%, compared with 0.54% in December 2025, suggesting that the general price level declined relative to the previous month.

Food Inflation Records Sharp Pullback

The most notable development in the report was the sharp contraction in food inflation. Food inflation stood at 8.89% year-on-year, marking a 20.73 percentage point decline from 29.63% recorded in January 2025.

On a month-on-month basis, food prices declined by 6.02%, compared with a 0.36% drop in December 2025. The decline was attributed to falling prices in key staples including water yams, eggs, green peas, groundnut oil, soya beans, palm oil, maize grains, guinea corn, beans, beef, cassava tuber and cow peas.

The average annual rate of food inflation for the twelve months ending January 2026 stood at 20.29%, down 18.18 percentage points from 38.47% recorded in January 2025. Given food’s significant weight in Nigeria’s consumption basket, the decline played a dominant role in moderating overall inflation.

Core Inflation Eases but Remains Elevated

Core inflation, officially defined as all items less farm produce and energy, stood at 17.72% year-on-year, down from 25.27% in January 2025.

On a month-on-month basis, core inflation fell to 1.69%, compared with 0.58% in December 2025.

The twelve-month average core inflation rate was 22.84%, lower than 27.24% recorded in January 2025, indicating that underlying structural pressures are easing, although they remain elevated.

Urban and Rural Inflation Trends Diverge

Urban inflation stood at 15.36% year-on-year, down 14.09 percentage points from 29.45% recorded in January 2025. On a month-on-month basis, urban inflation declined by 2.72%.

Rural inflation was slightly lower at 14.44% year-on-year, representing a 10.60 percentage point drop from 25.04% a year earlier. Month-on-month, rural prices fell by 3.29%.

However, the twelve-month average inflation for urban areas rose to 22.30%, compared with 18.88% in January 2025, reflecting cumulative price pressures over the past year.

State-Level Variations Persist

At the subnational level, inflationary trends varied widely.

On a year-on-year basis, Benue at 22.48%, Kogi at 20.98% and the Federal Capital Territory at 19.25% recorded the highest headline inflation rates. Ebonyi at 8.72%, Katsina at 8.94% and Imo at 10.61% recorded the lowest.

On a month-on-month basis, Imo and Ondo each recorded 1.93%, while Kaduna posted 0.67%. In contrast, Cross River at 6.34%, Ogun at 6.30% and Kogi at 6.03% recorded price declines.

Food inflation at the state level was highest in Kogi at 19.84%, Benue at 18.38% and Adamawa at 17.29%, while Ebonyi at 1.69%, Abia at 3.23% and Imo at 3.74% recorded the slowest increases.

Divisional Contributors to Headline Inflation

The largest contributors to year-on-year headline inflation were:

Food and Non-Alcoholic Beverages at 6.04%

Restaurants and Accommodation Services at 1.95%

Transport at 1.61%

Housing, Water, Electricity, Gas and Other Fuels at 1.27%

On a month-on-month basis, Food and Non-Alcoholic Beverages recorded the largest negative contribution at 1.15%.

Outlook Remains Cautious

The January 2026 data suggest inflationary pressures are easing more decisively than anticipated, particularly within food categories. However, core inflation and service-related components remain relatively sticky.

The trajectory in the coming months will depend on exchange rate stability, energy pricing, security conditions affecting agricultural production and the monetary policy stance of the Central Bank of Nigeria.

While headline inflation has moderated sharply year-on-year, elevated twelve-month averages indicate that full price normalization is still in progress.