However, the pressure on household pockets is still high. Released by the National Bureau of Statistics (NBS), the numbers are less of a celebration and more of a statistical change driven by technical factors and temporary price adjustments.

This decline from April’s 23.71% rate should mean things are improving, but that’s incorrect. Food inflation, arguably the most felt by everyday Nigerians, slowed year-on-year to 21.14% in May. 

Nonetheless, food prices actually rose on a monthly basis, climbing 2.19% from April’s 2.06%. Consumers aren’t imagining it, groceries still cost more today than they did last month.

The cause of the apparent dip is a mix of statistical changes and short-term economic interventions. In January, Nigeria rebased its Consumer Price Index (CPI), updating the basket of goods and base year for the first time since 2009. 

This change, while technically sound, has introduced what some experts call a “measurement paradox”: inflation looks lower, but the average Nigerian is still struggling to cope with high prices.

“This new CPI rebasing has a base-year effect that makes year-on-year comparisons appear softer,” one analyst explained. “But when you walk into a market, the prices don’t lie.”

Exchange rate stability has also played a role. The naira gained slightly against the dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM), helping lower the cost of imports. 

At the same time, costs of logistics fell slightly following a fair reduction in petrol prices. Dangote Refinery, for instance, dropped its PMS price from ₦835 to ₦825 per litre. These changes brought mild relief, but not enough to fundamentally change the inflation space.

The NBS noted that inflation pressures cooled across categories like clothing, utilities, and healthcare. Still, economists warn that any easing will be short-lived without structural reforms. 

Insecurity in major food-producing regions and early seasonal flooding in the Middle Belt continue to disrupt supply chains. These challenges, if left unchecked, could reverse the current profits and push inflation back up.

On a month-to-month basis, overall inflation stood at 1.53% in May, down from 1.86% in April. That shows a slower pace in rising prices, but it’s not yet the kind of drop that resets economic confidence.

Put simply, Nigeria’s inflation rate is easing, but for millions living paycheck to paycheck, the lived reality hasn’t changed. Bread, rice, and transport are still eating into monthly income, and unless underlying problems are fixed, May’s “progress” may prove hollow.

The FirstBank virtual event themed “Nigeria Economic Outlook 2023: A look ahead” is scheduled by 8:30am on Friday, 20 January 2023, via Zoom meeting. To register and participate in the event, do click on the link HERE.

The event will promote deliberations and analyses of national and global economic trends to shape 2023. Like its previous edition, the 2023 FirstBank Nigeria Economic Outlook aims to set the tone for the year by providing an opportunity for participants to learn directly from economic experts.

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Participants will be better informed and knowledgeably empowered to make the right decisions in their socio-economic activities in 2023.

‘Biodun Adedipe, Ph.D, founder and Chief Consultant of B. Adedipe Associates Limited (BAA Consult will lead deliberations at the event as its keynote speaker. Other speakers are FirstBank’s Ini Ebong, Executive Director, Treasury and International Banking; Tosin Adewuyi, Executive Director, Corporate Banking; Ugo “Ugodre” Obi-chukwu, Founder, NairaMetrics as well as Mosope Arubayi, economist and global financial analyst. Chike Uzoma, Head, Strategy & Corporate Development, FirstBank will moderate the event.

According to Mrs. Folake Ani-Mumuney, Group Head, Marketing & Corporate Communications of FirstBank ‘Our forthcoming Nigeria Economic Outlook webinar is a viable opportunity for one to be informed on key trends and activities that will shape the global socio-economic landscape in 2023. 2022 was indeed a turbulent year and from the 2023 forecast, the growth would still be slow. In addition, bearing in mind 2023 being an election year in Nigeria, like every democratic nation around the world, commercial and business activities in the country will be impacted by the forthcoming election.

I encourage everyone to join the event as the keynote speaker and panelists will shed more light and perspectives which will have participants informed about opportunities and happenings that will shape the socio-economic and political environment in the country and the world at large.”