Nigeria’s inflation rate eased slightly in January, strengthening expectations that the Central Bank of Nigeria (CBN) may begin monetary easing as early as next week.
According to market analysis by Lukman Otunuga, senior market Analyst at FXTM, headline inflation slowed to 15.1% year-on-year in January, down from 15.2% in December and significantly below the 19.5% medium estimate.
The moderation was largely driven by lower food prices, helping offset broader inflationary pressures across the economy.
CBN Rate Cut Expectations Rise
The latest inflation data has intensified speculation that the CBN may cut its benchmark interest rate after holding it steady at 27% in November.
Analysts note that easing price pressures, combined with the naira’s relative stability, provide room for policy recalibration. The naira has appreciated by approximately 8% against the US dollar year-to-date, reinforcing arguments for a shift toward monetary easing.
Market watchers now believe the debate is no longer whether the CBN will cut rates, but by how much.
A rate cut could provide relief to businesses and households, while also reshaping yield dynamics in Nigeria’s fixed-income market.
Oil in Focus as US-Iran Talks Resume
Beyond Nigeria, global markets are bracing for a potentially volatile week driven by geopolitics and key economic data releases.
On Tuesday, US-Iran talks in Geneva could influence the short-term trajectory of oil prices. Crude benchmarks have gained more than 10% year-to-date, supported by geopolitical tensions and supply risks.
A breakthrough in negotiations may ease supply concerns, while stalled talks could further tighten oil markets.
US PCE, Fed Minutes and GDP Data to Drive Markets
The main global focus this week will be US macroeconomic data, including:
- Federal Reserve meeting minutes
- December Personal Consumption Expenditures (PCE) report
- Delayed US Q4 GDP figures
The PCE report, the Federal Reserve’s preferred inflation gauge, will offer fresh insight into consumer spending trends, while GDP data will provide clarity on the health of the world’s largest economy.
Last week’s softer-than-expected US CPI data strengthened expectations of rate cuts, with traders now pricing a roughly 50% probability of three Federal Reserve rate cuts in 2026.
Should upcoming data reinforce dovish expectations, the dollar may weaken further, potentially supporting gold and US equities.
Bitcoin Under Pressure, $60,000 Level in Sight
In the cryptocurrency market, Bitcoin remains under pressure, down more than 20% year-to-date, with prices hovering near the $70,000 level.
Daily technical charts indicate that $60,000 could serve as a potential liquidation zone, according to Bloomberg reports.
Market direction in crypto is likely to be influenced by broader risk sentiment and US macro data.
Gold Tests $5,000 Psychological Level
Gold ended last week above the $5,000 psychological level but started the new week cautiously.
With Chinese markets closed, liquidity may remain thin, leaving gold vulnerable to geopolitical headlines and US data surprises.
If $5,000 holds as support, bullion could rebound toward $5,100. However, a sustained break below this level may trigger declines toward $4,880 and $4,850.
What this Means for Nigeria
For Nigeria, the combination of easing domestic inflation and a potentially softer US dollar environment may offer macroeconomic breathing space.
However, global volatility, oil price movements, and US monetary policy shifts will continue to shape capital flows, exchange rate stability, and investor sentiment in the week ahead.
