A mid Higher Energy, Food, Commodity Prices, Inflation Rebounds to 15.38%

• Severe in Bayelsa, Sokoto, Bauchi, others 

•CPPE says resurgence threatens gains of disinflation

James Emejo in Abuja and Dike Onwuamaeze in Lagos

The Consumer Price Index (CPI), which measures the rate of change in prices of goods and services, increased to 15.38 per cent in March, compared to 15.06 per cent in February and 27.35 per cent in the corresponding month of 2025, National Bureau of Statistics (NBS) said yesterday.

This is the first increase in headline inflation after 13 consecutive months of disinflation.

The rebound could be attributed to the fallout of global headwinds occasioned by the current war in the Middle East between US-Israel and Iran, leading to higher energy prices among others.

Reacting to the renewed uptick in prices, Chief Executive, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said it signalled a worrying resurgence of inflationary pressures, particularly on a month-on-month basis.

Yusuf said the report highlighted a critical development in the country’s inflation trajectory, where the earlier gains in disinflation were now being threatened by a resurgence of cost-driven pressures, particularly from energy, food and transportation.

According to the CPI report for March, month-on-month, the headline index stands at 4.18 per cent compared to 2.01 per cent in February.

Year-on-year, food inflation stood at 14.31 per cent compared to 25.22 per cent in March 2025.

However, month-on-month, the food index was 4.17 per cent, representing 0.52 per cent decline compared to 4.69 per cent in the preceding month

The statistical agency attributed the moderation in food inflation to changes in the prices of yam, ginger, cassava tuber, groundnuts, irish potatoes, avenger (ogbono/apon), tomatoes, cassava flour, among others.

Similarly, core inflation, which excludes the prices of volatile agricultural produces and energy, stood at 16.21 per cent, year-on-year in March compared to 27.12 per cent in same month 2025.

However, month-on-month, core index stood at 4.03 per cent in March, compared to 0.89 per cent in the preceding month.

Year-on-year, urban inflation stood at 14.64 per cent and 3.16 per cent month-on-month in March, compared to 2.55 per cent in the preceding month.

Rural inflation stood at 17.22 per cent year-on-year in March while month-on-month, the index stood at 6.73 per cent, from 0.71 per cent in February.

At state level, year-on-year, headline inflation was highest in Bayelsa (27.37 per cent), Sokoto (26.03 per cent), and Bauchi (23.67 per cent), while Osun (5.25 per cent), Kano (9.85 per cent), and Kaduna (10.38 per cent) recorded the lowest rise in prices.

Month-on -month, however, the highest price increases were recorded in Zamfara (10.77 per cent), Bauchi (9.37 per cent), and Sokoto (9.05 per cent), while Lagos (1.54 per cent), Akwa Ibom (1.80 per cent), and Rivers (1.89 per cent) recorded the lowest rise.

Month-on-month, food inflation was highest in Sokoto (11.78 per cent), Niger (8.59 per cent), and Gombe (8.10 per cent), while Katsina (0.09 per cent), Ogun (0.77 per cent), and Adamawa (1.30 per cent) recorded the slowest rise in food prices.

Yusuf said, “This emerging trend suggests that while inflation had been moderating on a year-on-year basis, underlying structural vulnerabilities remain largely unresolved, with recent month-on-month increases pointing to renewed price momentum.

“The situation calls for urgent and targeted policy responses, as failure to address these supply-side drivers could reverse the fragile stability achieved and deepen the cost-of-living challenges facing households and businesses.

“While disinflation trends remain evident on a year-on-year basis, the resurgence of monthly inflation pressures signals that macroeconomic stability is still fragile.”

He said the policy response should shift from a narrow focus on monetary tools to a broader strategy that could address the structural drivers of inflation, particularly in energy, food, and transportation.

Yusuf stated, “Without decisive action in these areas, the gains recorded in inflation moderation may prove temporary, while households and businesses continue to grapple with significant cost pressures.”

He said the recent uptick in inflation was largely reflective of renewed energy price pressures, which had continued to permeate production, transportation, and distribution costs across the economy.

He emphasised that energy remained a critical cost driver in Nigeria because of the persistent reliance on gas, diesel and petrol for power generation, logistics, and industrial operations.

Yusuf said, “The implications are far-reaching as rising energy costs are quickly transmitted into higher transportation costs, increased food prices, escalating production and distribution expenses

“This cost-push dynamic explains the sharp increase in month-on-month inflation and signals that the underlying inflationary pressures are far from subdued.”

According to him, the CPI data clearly shows that food and transportation-related costs remain the most significant contributors to inflation, accounting for a substantial proportion—estimated about 70 per cent of inflationary pressures when direct and indirect effects are considered.

He said, “Food inflation stood at 14.31 per cent year-on-year, while core inflation—which captures broader price pressures—rose to 16.21 per cent.

“These figures are particularly troubling given their direct impact on household welfare.”

He said transportation costs, heavily influenced by fuel prices and logistics inefficiencies, had continued to exert strong upward pressure on prices across sectors.

He also pointed out that the dominance of food and transport in the inflation basket had profound welfare consequences because they were non-discretionary expenditures, meaning households cannot easily adjust consumption in response to rising prices.

The CPPE leader stated that a major structural concern highlighted by the inflation dynamics was the dominance of the private sector in public transportation, especially road transport that was highly unionised and possessed considerable pricing power with limited regulatory restraint on fare adjustments.

Therefore, “In an environment of rising fuel costs, this structure enables rapid and often disproportionate increases in transport fares, which are quickly transmitted across the economy,” Yusuf said. He said this underscored a critical absence of efficient, affordable, and well-regulated public transportation systems, which left citizens exposed to price shocks and market inefficiencies.

Yusuf said, “Given the centrality of food and transportation to inflation and welfare, CPPE strongly recommends that governments at both federal and sub-national levels prioritise interventions in these sectors.”

According to him, “Boosting agricultural productivity is the most sustainable pathway to moderating food inflation, not importation.

“A more structured and efficient public transport system will significantly reduce inflationary pressures and improve welfare outcomes.

“CPPE reiterates that the current inflationary pressures are predominantly cost-push in nature, driven by energy, logistics and structural inefficiencies—not excess demand.

“We, therefore, strongly caution against using the recent uptick in inflation as a basis for additional monetary tightening.”