Market News
Drop in inflation rate yet to ease hardship for Nigerians
…Citizens still complain of high cost of living
…’Naira has so much lost value that it can longer buy much’
When the National Bureau of Statistics (NBS) released the latest Consumer Price Index report last week, showing that Nigeria’s headline inflation rate had declined for the second consecutive month, from 24.23% in March to 22.97% in May 2025, there was muted optimism in economic circles.
But for many Nigerians on the streets, the news rang hollow.
“I don’t know where they get their figure from,” said Esther Adewole, a Lagos-based petty trader. “They say inflation is dropping, but things are still very expensive. I can no longer cook a pot of soup with N3,000.”
Esther’s frustration mirrors the sentiment of millions of Nigerians who say the statistical drop in inflation has not translated into any meaningful relief in their daily lives.
Though the inflation rate has now declined for two consecutive months, falling from a peak of 34.80% in December 2024, many say the prices of essentials are still far beyond their reach.
Read also: Inflation is falling, but businesses are still gasping for air
Food still a major pain point
Food, which accounts for a large portion of household spending, remains a major source of distress.
According to the NBS, food inflation stood at 21.14% year-on-year in May, down sharply from 40.66% in May 2024. But the apparent relief in year-on-year numbers was partly due to a change in the base year for the CPI, analysts say.
On a month-on-month basis, food inflation actually rose to 2.19% in May from 2.06% in April, driven by increases in the prices of staple items like yam, cassava flour, maize flour, sweet potatoes, and fresh pepper.
Take rice, for instance, a staple food in many Nigerian homes. A 50kg bag of foreign rice, which cost about N30,000 in May 2023, skyrocketed to over N100,000 by the end of 2024. Though prices have since come down, the current market average of N60,000–N70,000 remains a significant burden.
“Yes, rice is no longer N100,000, but N65,000 is still a big problem for low-income earners like me,” said Ibiyemi Solomon, a secondary school teacher. “We are just learning to eat less or find cheaper alternatives. That’s how we’re surviving.”
Transport costs still high
Transport fares are another area where the reduction in inflation hasn’t helped much. With petrol prices hovering between N860 and N950 per litre, down from the N1,000+ peak last year, but far above pre-subsidy levels, commuters say they are still spending double or triple on daily transport compared to 2023.
“From Iyana Ipaja to Obalende used to be N700, now it’s N1,500,” said a civil servant who wants to remain anonymous. “How is that a sign that things are improving? If you have to go out every day, you will feel it in your pocket.”
Exchange rate still biting
Another persistent driver of hardship is the naira’s weakened value. Though relatively stable in recent months, the exchange rate remains high at an average of N1,600 to the dollar, after hitting a peak of over N1,900 at the parallel market in early 2024.
This has had knock-on effects on the prices of electronics, auto parts, and household goods, most of which are imported.
“My phone is faulty but I can’t afford a new one,” Ibiyemi, earlier quoted, said. “My four months’ salary can’t get me a good smart phone.”
‘Naira no longer has value’
Analysts argue that while inflation may be slowing, the damage done by last year’s economic upheavals, including fuel subsidy removal, currency devaluation, and tight monetary policies, has created a “new normal” that ordinary Nigerians are struggling to adjust to.
For many citizens, the conversation isn’t about percentage points or economic models, it’s about survival.
“The naira has lost so much value that it no longer buys much these days,” the civil servant, earlier quoted, said. “It’s like we are running fast but not moving. Inflation may be going down, but suffering is still rising.”
Until real wages catch up and essentials become affordable again, most Nigerians say they will hold off celebrating any ‘progress’ in the economy.
