According Central Bank of Nigeria’s (CBN) report, Nigeria’s inflation rate continues its downward trajectory, and Nigerians are finding little relief in their daily lives. While government economic managers celebrate these signs of improving macroeconomic stability, the one-on-one reality shows that many households and small businesses across the nation, are still trapped between persisting high living costs and expensive access to credit.
Recent figures from the Central Bank of Nigeria (CBN) show that inflation declined to 15.9 per cent in May 2026, a significant drop from 22 per cent recorded in September 2025. Yet, for millions of Nigerians, the easing inflation rate, has not translated into cheaper food, transportation, housing, healthcare, or even education. The disconnection between official economic indicators and everyday realities, is progressively more apparent.
Following the CBN’s April 2026 Household Expectations Survey, majority of Nigerians are more concerned about reducing borrowing costs, than bringing inflation down further. The survey found that 60.9 percent of respondents, want interest rates lowered, while 50.8 percent said they would rather have cheaper access to loans, even if inflation rises again. Only 41.1 percent preferred lower inflation at the expense of higher interest rates. The findings reveal the difficult choices confronting ordinary citizens, as government economic managers attempt to steer Africa’s largest economy toward stability.
Nigeria’s inflation landscape changed significantly in 2024, when the National Bureau of Statistics rebased the Consumer Price Index (CPI), replacing the 2009 base year with a more current consumption framework. The adjustment was designed to better capture how Nigerians spend their money today and provide government with more accurate data, for economic planning. Government officials are of the opinion that the rebasing exercise would improve the quality of economic decision-making and strengthen investors’ confidence, by providing a clearer picture of inflationary pressures within the economy.
Following the rebasing, the CBN intensified its inflation-fighting campaign, by raising the Monetary Policy Rate (MPR) throughout 2024 and into 2025. The strategy was aimed at reducing excess liquidity, slowing consumer demand and ultimately bringing price increases under control.
By September 2025, the policy appeared to be producing results. Inflation began to moderate, prompting the apex bank to cut the benchmark interest rate from 27.5 percent to 27 percent, its first rate reduction, after an extended period of monetary tightening. Although modest, the move gestured growing confidence among decision-makers that inflationary pressures were gradually easing. Even so, falling inflation does not mean lower prices.
Economic experts caution that many Nigerians misunderstand what declining inflation actually means. A lower inflation rate does not indicate that prices are falling. Rather, it means prices are increasing at a slower pace. So, households already struggling with elevated food and energy costs, this distinction in understanding, is critical. In other words, a bag of rice, transportation fares, school fees, rent, electricity bill, etc., may continue to rise, even when inflation declines. The only difference is that the rate of increase, becomes less severe. This explains why many Nigerians’ reports, flare little improvement despite the steady decline in official inflation figures, over recent months.
Continue reading with Eandel
Subscribe to unlock the complete story and receive your subscriber benefits.
