The Central Bank of Nigeria (CBN) has forecast that the country’s inflation rate will moderate to an average of 12.94 percent in 2026, driven largely by easing food and fuel prices.
The projection was contained in the Bank’s 2026 Macroeconomic Outlook, released on Wednesday, which also estimates that Nigeria’s economy will expand by about 4.49 percent during the year.
According to the CBN, the anticipated growth will be supported by ongoing structural reforms across key sectors, alongside a gradual relaxation of tight monetary policy measures introduced in recent years to curb inflationary pressures.
The Bank noted that headline inflation is expected to soften as food prices decline and the cost of premium motor spirit (petrol) continues to fall.
Officials explained that the reforms are designed to strengthen productivity, enhance competitiveness, and create a more resilient economy capable of sustaining growth while keeping inflation within manageable levels.
The outlook follows recent reductions in fuel prices nationwide, influenced by heightened competition in the downstream oil market.
The Dangote Refinery has notably cut its ex-depot prices, contributing to pump prices currently ranging between ₦739 and ₦910 per litre across the country.
Analysts say the refinery’s entry into the market has disrupted pricing dynamics, offering consumers relief after years of volatility in fuel costs.
Lower fuel prices are expected to ripple across the economy, reducing transportation costs and easing pressure on household budgets.
Food Inflation Trends
Meanwhile, figures from the National Bureau of Statistics (NBS) show that food inflation eased to 11.08 percent in November 2025, reinforcing expectations of further moderation in the months ahead.
The decline has been attributed to improved harvests, better distribution networks, and targeted government interventions aimed at stabilising food supply.
The CBN believes that sustained improvements in food production and distribution will play a critical role in keeping inflation under control, given that food accounts for a significant share of household expenditure in Nigeria.
With inflation projected to ease and growth expected to strengthen, the CBN’s forecast paints a cautiously optimistic picture for Nigeria’s economy in 2026.
The Bank emphasised that continued discipline in fiscal and monetary management, coupled with reforms in energy, agriculture, and infrastructure, will be essential to achieving these targets.
For households and businesses, the outlook offers hope of a more stable economic environment, with reduced inflationary pressures and stronger growth prospects as the new year unfolds.
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