Market News

Nigeria’s headline moderated to 20.12 percent year-on-year in August.

According to analysts at FBNQuest, the easing in August’s inflation reading was driven by softer energy prices and ongoing stability in the FX market, driven by sustained FX liquidity.

The headline inflation rate moderated to 20.12 percent year-on-year in August, down from 21.88 percent recorded in July.

Central bank’s sustained monetary tightening efforts have alleviated demand-side pressures, supported by a moderate expansion in credit allocation.

The naira recorded its strongest gain in seven months last week, buoyed by robust foreign reserves that saw a $4.1 billion rise between July and August.

Data from the Central Bank of Nigeria (CBN) showed that the local currency strengthened to N1,506.08 to a dollar on Wednesday at the Nigerian Foreign Exchange Market (NFEM). The naira previously reached this mark on March 5, 2025, when it closed at N1, 500.80/$.

On a month-on-month basis, headline inflation dropped to 0.74 percent in August, compared with 1.99 percent the previous month.

The continued pressure on monthly price levels is primarily driven by disruptions in the food supply chain, which stem from persistent security challenges across key agricultural regions.