• Food, transportation spike inflation in March

The Centre for the Promotion of Private Enterprise (CPPE), yesterday warned against the current inflationary pressures are predominantly cost-push in nature, driven by energy, logistics and structural inefficiencies and not excess demand.
The Group, a policy and economic think-tank body, therefore cautioned against using the recent uptick in inflation as a basis for additional monetary tightening. It noted that further monetary tightening would be ineffective in addressing the root causes of inflation, high interest rates would hurt economic growth, investment and productivity; while the real sector would face increased financing constraints, undermining recovery efforts.
Reacting to the March Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS), the CPPE boss, Dr. Muda Yusuf, described as worrisome the latest inflation data, describing it as a signaling a worrying resurgence of inflationary pressures, particularly on a month-on-month basis.
He said that while recent months have reflected a gradual moderation in year-on-year inflation, the release of the March CPI report gives a cause for concern given that headline inflation edged up to 15.38 per cent in March, while month-on-month inflation accelerated sharply to 4.18 per cent, nearly double the level recorded in February.
This development, Yusuf argued, underscores the fragility of the disinflation process and raises concerns about renewed cost pressures in the economy.
“The March 2026 CPI report highlights a critical development in Nigeria’s inflation trajectory, where the earlier gains in disinflation are now being threatened by a resurgence of cost-driven pressures, particularly from energy, food and transportation.
“This emerging trend suggests that while inflation had been moderating on a year-on-year basis, underlying structural vulnerabilities remain largely unresolved, with recent month-on-month increases pointing to renewed price momentum.
“The situation calls for urgent and targeted policy responses, as failure to address these supply-side drivers could reverse the fragile stability achieved and deepen the cost-of-living challenges facing households and businesses.
“While disinflation trends remain evident on a year-on-year basis, the resurgence of monthly inflation pressures signals that macroeconomic stability is still fragile. The policy response must therefore shift from a narrow focus on monetary tools to a broader strategy that addresses the structural drivers of inflation, particularly in energy, food and transportation.
“Without decisive action in these areas, the gains recorded in inflation moderation may prove temporary, while households and businesses continue to grapple with significant cost pressures,” Yusuf said.
Yusuf, who also doubles as the Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), noted that the recent uptick in inflation is largely reflective of renewed energy price pressures, which continue to permeate production, transportation and distribution costs across the economy.
Insisting that energy remains a critical cost driver in the country, given the persistent reliance on gas, diesel and petrol for power generation, logistics and industrial operations, Yusuf noted the implications of the development as “far-reaching.” Specifically, he pointed out that rising energy costs are quickly transmitted into higher transportation costs; increased food prices and escalating production and distribution expenses.
“This cost-push dynamic explains the sharp increase in month-on-month inflation and signals that the underlying inflationary pressures are far from subdued,” Dr. Yusuf explained.
Analysing the CPI data, the CPPE boss noted that it clearly shows that food and transportation-related costs remain the most significant contributors to inflation, accounting for a substantial proportion which is estimated at about 70 per cent of inflationary pressures when direct and indirect effects are considered.
From the data, food inflation stood at 14.31 per cent year-on-year, while core inflation—which captures broader price pressures—rose to 16.21 per cent. On the other hand, transportation costs, which are heavily influenced by fuel prices and logistics inefficiencies, exerted strong upward pressure on prices across sectors as higher transport costs raise the cost of moving food, goods and services nationwide, thereby amplifying inflation.
“These figures are particularly troubling given their direct impact on household welfare. The dominance of food and transport in the inflation basket has profound welfare consequences. These are non-discretionary expenditures, meaning households cannot easily adjust consumption in response to rising prices,” Dr. Yusuf said, adding that the situation is even more concerning given that rural inflation remains elevated, reflecting structural challenges in agricultural productivity and distribution systems.
The implications of these is the erosion of real incomes and purchasing power; rising cost of living pressures on households; increased poverty and vulnerability, particularly in rural areas and heightened inequality across regions and income groups.
The CPPE admonished that given the centrality of food and transportation to inflation and welfare, governments at both federal and subnational levels should prioritise interventions in these sectors.
For instance, in agricultural productivity, there is an urgent need to improve security in farming communities, strengthen rural infrastructure and logistics, enhance access to inputs and financing and promote mechanisation and modern farming techniques.
“Boosting agricultural productivity is the most sustainable pathway to moderating food inflation, not importation. Besides, governments at all levels should invest significantly in mass transit systems, bus and rail, reduce reliance on fragmented private transport systems, introduce regulatory frameworks to curb exploitative pricing and improve urban mobility infrastructure. A more structured and efficient public transport system will significantly reduce inflationary pressures and improve welfare outcomes,” Dr. Yusuf noted.

Nigeria’s economy is resilient and set to grow in the first half of 2026 despite the Iran war, the World ‌Bank has said.

It however said that rising fuel costs and persistently high inflation risk squeezing incomes and slowing poverty reduction.

The bank also advised Nigeria to remove controls on fuel imports to ease inflation and support growth.

Business activity remains in expansion territory with the U.S./Israel-Iran conflict so far lifting prices but leaving output largely intact, World Bank Nigeria lead economist FisehaHaile said during a presentation in the capital Abuja.

“Overall business activity has been expanding over the past fewmonths, suggesting the impact on growth has been relatively contained. But the shock is still ⁠being felt through higher inflation,” Haile said.

President Bola Tinubu, now in his third year in office, has rolled outNigeria’s most ambitious economic overhaul in decades by ending costly fuel and energy subsidies, devaluing the currency and changing the tax system to stabilise an economy battered by high inflation, currency weakness and external shocks.

Inflation eased sharply to 15.06 per cent in February from around 33 per cent in December 2024, but remains high compared with regional peers and has come under renewed pressure since the Middle East conflict began, Haile said.

Fuel prices have risen more than 50 per cent during the Iran war, feeding into transport, food and production costs. Nigeria should consider lifting curbs on fuel imports to help ease inflation, he said.

“Inflation is still elevated and under ‌increasing ⁠pressure, and that poses risks to incomes and poverty reduction,” Haile said.

Nigeria’s external buffers have improved as foreign exchange reserves rise and volatility eases, but tighter global financing conditions still threaten inflows, borrowing costs, and remittances.

Nigeria’s fiscal deficit widened slightly to 3.1 per cent of Gross Domestic Product (GDP) in 2025, but remains lower than in pre-reform years, Haile said, adding that the debt‑to‑GDP ratio fell for the first time in a decade, helped ⁠by stronger fiscal performance and exchange rate valuation gains.

The World Bank forecasts economic growth of about 4.2 per cent for 2026 and urged authorities to save windfalls from higher oil prices, keep monetary policy tight, and avoid blanket subsidies to rein in inflation.

The Federal Government has said Nigeria is looking to learn from Indonesia’s transformation into a $1.4 trillion economy as it pursues its own ambition of building a $1 trillion economy under the administration of Bola Tinubu.

A statement from the ministry on Tuesday said the Minister of Budget and Economic Planning, Senator Abubakar Bagudu, made the disclosure when Indonesia’s Ambassador to Nigeria, Bambang Suharto, paid a courtesy visit to the ministry in Abuja to deepen discussions on economic cooperation and development partnerships.

Bagudu said Nigeria is particularly interested in how Indonesia achieved such rapid economic growth, noting that the country’s experience offers useful lessons as Nigeria moves ahead with its 2026–2030 National Development Plan.

“Indonesia remains a vital partner for Nigeria as we strive for inclusive growth and economic transformation. There is much we can accomplish together through shared knowledge, investment, and innovation,” he said.

The minister added that achieving Nigeria’s $1 trillion economy target would depend largely on private sector participation and stronger collaboration with international partners.

Also speaking, Minister of State for Budget and Economic Planning, Dr. Doris Uzoka-Anite, said Nigeria and Indonesia share cultural and economic similarities that can support deeper cooperation. She called for stronger engagement and better knowledge exchange to turn opportunities between both countries into real economic gains.

Earlier, the Permanent Secretary of the ministry, Deborah Odoh, described the visit as a sign of the long-standing relationship between both countries. She said Indonesia’s progress in governance, economic diversification and public sector reforms provides practical lessons Nigeria can adopt.

According to her, the engagement offers an opportunity to strengthen institutional collaboration and identify workable solutions that can drive inclusive growth, especially among countries in the Global South.

In his remarks, Ambassador Suharto said Indonesia remains committed to strengthening its relationship with Nigeria across key sectors.

He pointed to ongoing cooperation in agriculture, including livestock development projects in Sokoto State and Kebbi State, as well as growing partnerships in the pharmaceutical sector, where Indonesian companies are setting up manufacturing facilities in Lagos.

The ambassador also disclosed plans to expand cooperation into strategic industries such as aviation and maritime services, including the development of Maintenance, Repair and Overhaul facilities to position Nigeria as a regional hub.

Both countries agreed to strengthen their cooperation frameworks, expand investment opportunities and build stronger partnerships aimed at supporting sustainable economic growth.