Africa (Commonwealth Union) _ Nigeria‘s inflation war started to improve in August 2025 as the National Bureau of Statistics (NBS) reported that headline inflation slowed to 20.12 per cent, a one-year low. The pace declined by 1.76 percentage points from 21.88 per cent in July and a sharp decline from 32.15 per cent recorded in August 2024.
The Consumer Price Index report released on Monday in Abuja explains that price increases remain high but at a slower rate. Month-on-month inflation, too, relaxed to 0.74 per cent in August from 1.99 per cent in July, a sign that pressures on short-term household budgets are beginning to relax.
Food inflation, the most obstinate driver of escalating costs in the country in the recent past, too, quickened sharply. The year-on-year food inflation rate declined to 21.87 percent from a historical high of 37.52 per cent in the same period last year, courtesy of the statistical effect of the new base year implemented in the CPI rebasing. Month-on-month food inflation slowed to 1.65 per cent from 3.12 per cent in July, assisted by a decline in prices of staples such as rice, maize flour, guinea corn, semolina, and soya milk.
Despite this reprieve, though, the report showed that the three largest contributors to headlining inflation are food and beverages (8.05 percent), restaurants and accommodation services (2.60 percent), and transport (2.15 percent). The smallest contributors were recreation and culture (0.06 percent), alcohol and tobacco (0.07 percent), and financial services (0.09 percent).
There were also geographical imbalances. The highest year-on-year inflation was in Ekiti, Kano, and Oyo at 28.17 percent, 27.27 percent, and 26.58 percent respectively, while Zamfara had the lowest growth at 11.82 percent. On a monthly basis, Yobe posted the highest growth of 9.20 percent, while Bayelsa recorded the sharpest decline of -9.52 percent.
Urban inflation was slightly lower at 19.75 percent, down from 20.28 percent in rural areas, showing the skewed direction of price movements in the country. Core inflation, excluding food and energy, was 20.33 percent year-on-year, pointing to deep-seated underlying pressures.
The NBS also noted that the CPI rebasing, which modified the base year from 2009 to 2024, has given a more realistic portrait of today’s consumption patterns, as the index rose to 126.8 points in August from 125.9 in July.
For policymakers, the latest information brings cautious optimism. Although inflation remains elevated, the trend suggests a gradual return to price stability, providing room for Nigeria’s struggling businesses and households.
