Yemisi Izuora
The Center for the Promotion of Private Enterprise (CPPE) has linked rising inflation index in Nigeria to so many factors but specifically linked to sustainable hike in energy cost.
In a policy brief on April inflation index, Chief Executive Officer (CEO) of the Center, Dr. Muda Yusuf, observed that Nigeria’s inflation outlook in April 2026 reflects a fragile disinflation process amid mounting global and domestic cost pressures. Headline inflation rose marginally from 15.38 per cent in March to 15.69 per cent in April, indicating that although inflationary pressures remain elevated, the pace of acceleration was relatively moderate.
More encouraging, however, was the moderation in the month-on-month inflation metrics across virtually all major indicators.
Headline month-on-month inflation declined by 2.05 per cent, food inflation eased by 0.54 per cent, core inflation declined by 3.0 per cent, urban inflation moderated by 1.3 per cent, while rural inflation dropped sharply by 3.9 per cent. This suggests a weakening in short-term inflationary momentum.
The policy priority, he advised should therefore shift more decisively towards supply-side interventions.
In his view, Government at both federal and state levels should intensify measures to reduce energy costs, improve transportation infrastructure, strengthen food supply systems, enhance trade facilitation and support domestic productivity.
For businesses, the operating environment remains extremely challenging.
He noted that firms should prioritize energy efficiency, dynamic pricing models, consumer segmentation and affordability-driven product strategies, including smaller pack sizes, as consumers become increasingly price-sensitive and discretionary spending weakens.
Overall, the April inflation numbers suggest that while inflationary momentum may be moderating, the disinflation process remains highly vulnerable to external shocks, especially geopolitical developments in the global energy market. Sustained inflation moderation will depend largely on structural reforms and targeted interventions to reduce the cost of food, transportation and energy within the economy.
Nonetheless, inflation conditions remain severe from a welfare and business cost perspective.
Food inflation stood at 16.06 per cent, while core inflation remained elevated at 15.86 per cent.
The dominant inflation drivers continue to be food, transportation, energy products, healthcare and restaurant services, which together accounted for about 87 per cent of the inflation pressure recorded in April.
These are essential expenditure items which absorb the bulk of household income, particularly among low-income Nigerians.
The current geopolitical tensions involving Iran, Israel and the United States are also intensifying inflationary risks.
The conflict has triggered renewed volatility in the global oil market, pushing up crude oil prices and transmitting higher energy costs into the domestic economy. Rising petrol, diesel and gas prices are fueling transportation, logistics and production costs across sectors, with significant pass-through effects on food prices and overall consumer inflation.
This further underscores the structural and supply-side nature of Nigeria’s inflation challenge.
Monetary tightening alone cannot resolve inflation driven by energy costs, logistics inefficiencies, food supply disruptions and weak infrastructure conditions.
Additional monetary tightening could worsen financing costs for businesses, weaken investment and further constrain productivity growth.