Nigeria’s inflation rate has jumped to 24.23% in March 2025, up from 23.18% in February, according to the National Bureau of Statistics (NBS).
This surge is a blow to household incomes and the economy at large.
The NBS report reveals that food inflation, a major contributor to headline inflation, rose to 21.79% year-on-year in March 2025.
This increase is attributed to high prices of staple food items like ginger, garri, and rice. Core inflation, which excludes volatile agricultural produce and energy, also climbed to 24.43% year-on-year.
A closer look at the data shows a noticeable divergence between urban and rural inflation rates. Urban inflation stood at 26.12% year-on-year, while rural inflation was 20.89%. On a month-on-month basis, urban inflation rose by 3.96%, compared to 2.40% in February.
Experts in the field have said the March inflation reading resulted from opposing forces, including moderating and upward factors.
Samuel Oyekanmi, head of Research at Norrenberger, noted that the constant effect of rebasing and favourable base effects are expected to exert a moderating influence.
However, he warns that the depreciation of the naira and increase in petrol prices could raise costs across transport and goods.
“The continued effect of rebasing and favourable base effects are expected to exert a moderating influence,” Oyekanmi said.
The surge in inflation could put more pressure on the Central Bank of Nigeria (CBN) to tighten monetary policy further. Analysts expect the CBN to introduce liquidity management measures to support the currency and contain inflation expectations.
The outlook for Nigeria’s inflation rate reveals potential upside risks from electricity tariff adjustments and geopolitical disruptions to global supply chains.
Meristem projects inflation to stay within the 20-24% band through mid-year, pointing to expected stability in energy prices and a slower pace of naira depreciation.
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