MORGANABLE ECONOMY WATCH
Nigeria’s headline inflation rate fell to 14.63 per cent in September 2026, down from 15.39 per cent in August. However, the latest figures from the National Bureau of Statistics (NBS) show that rising energy costs continue to threaten the improvement.
Akure—
Nigeria’s headline inflation rate fell to 14.63 per cent in September 2026, down from 15.39 per cent in August. However, the latest figures from the National Bureau of Statistics (NBS) show that rising energy costs continue to threaten the improvement.
The NBS released its September Consumer Price Index report on October 15. It showed that annual headline inflation declined for another month, extending the recent slowdown in price increases. Nevertheless, households and businesses still face pressure from fuel, transport, food and other essential expenses.
The September rate was 6.35 percentage points lower than the 20.98 per cent recorded in September 2025. However, it does not mean that the prices of goods and services have returned to earlier levels.
Instead, inflation measures how quickly prices rise over time. Therefore, a lower rate means prices are increasing more slowly on average, not necessarily that shoppers are paying less. This distinction remains important as Nigerians continue to manage the cost of everyday needs.
ENERGY COSTS REBOUND SHARPLY
Although headline inflation declined, energy prices moved in the opposite direction during September. The NBS report showed that monthly energy inflation climbed to 5.38 per cent from 0.36 per cent in August, an increase of 5.02 percentage points.
On a year-on-year basis, energy inflation reached 10.85 per cent in September, compared with 4.69 per cent in August. The increase points to renewed pressure from energy-related expenses, including costs that affect transport, electricity generation and business operations.
The Centre for the Promotion of Private Enterprise warned that the jump in monthly energy inflation could undermine the recent decline in headline inflation. Its chief executive, Muda Yusuf, said policymakers should strengthen domestic energy resilience and reduce the costs of producing and distributing goods.
FOOD PRICES OFFER SOME RELIEF
Food prices helped moderate the overall inflation rate in September. Annual food inflation stood at 19.59 per cent, compared with 19.57 per cent in August, and was below the 20.16 per cent recorded in September 2025.
The annual figure remained high, however, and food continues to take a large share of many household budgets. A modest change in the annual rate may not immediately translate into meaningful relief for families buying staples, vegetables, cooking ingredients and other necessities.
On a month-on-month basis, food inflation fell to minus 1.55 per cent in September from 1.02 per cent in August. The NBS linked the decline to price movements in items such as rice, flour, eggs, onions, palm oil, potatoes, tomatoes and plantain.
This monthly decline suggests that average food prices included in the index fell compared with August. Still, the experience can differ by location, product and household. Some items may become cheaper while others remain expensive or rise in price.
CORE INFLATION SENDS A MIXED SIGNAL
Core inflation, which excludes certain volatile agricultural and energy items, also showed a mixed pattern. Its annual rate stood at 12.95 per cent in September, lower than 13.29 per cent in August and 22.11 per cent a year earlier.
However, monthly core inflation rose to 1.11 per cent from minus 0.06 per cent in August. This indicates that prices across parts of the underlying goods and services basket increased more quickly during September than in the previous month.
The contrast matters because a lower annual rate can exist alongside fresh monthly pressure. If those increases continue, they could slow further progress in reducing inflation.
The Consumer Price Index also edged up to 146.38 points in September from 146.30 points in August. This shows that the overall price level increased slightly, even as the annual inflation rate fell.
DIFFERENCES ACROSS STATES
Imo recorded the highest annual headline inflation at 30.04 per cent, followed by Enugu at 22.38 per cent and Niger at 22.05 per cent. Taraba recorded the lowest rate at 1.78 per cent.
Food inflation also differed sharply by state. Lagos recorded the highest annual food inflation at 34.40 per cent, followed by Imo at 33.79 per cent and Ondo at 31.49 per cent. Taraba recorded food deflation of 7.47 per cent, while Yobe recorded a decline of 0.37 per cent.
IMPLICATIONS FOR POLICY AND BUSINESS
The latest figures could strengthen arguments for lower borrowing costs, particularly if inflation continues to moderate. However, policymakers must weigh that possibility against the risk that rising energy prices and renewed monthly core inflation could reverse some of the gains.
Yusuf has called for measures to improve electricity supply, expand compressed natural gas infrastructure, support domestic refining and reduce distribution costs. Better roads, storage facilities and agricultural productivity could also help limit the cost of moving food from farms to consumers.
For companies, lower annual inflation may improve planning, but it does not automatically reduce operating expenses. Businesses still need to account for fuel, electricity, transport, wages, financing and imported inputs when setting prices and managing budgets.
OUTLOOK
Nigeria’s inflation rate fell to 14.63 per cent in September, marking another step in the recent easing trend. Lower monthly food prices supported the decline, while the annual rate remained well below its level a year earlier.
Yet rising energy inflation and faster monthly core inflation show that the improvement remains vulnerable. If energy expenses feed into transport, production and distribution, they could put renewed pressure on prices in the months ahead.
For readers, the measure will be whether monthly inflation remains low in October. A sustained slowdown would suggest that price pressures are easing more broadly, while another jump in energy costs could weaken confidence in the recovery.
The next inflation reports will help show whether September’s decline signals a durable improvement or a temporary pause in price pressures. For now, the figures offer a mixed picture: overall inflation is easing, but households and businesses continue to face significant costs.
