Nigeria’s inflation rate increased to 15.38 percent in March 2026 from 15.06 percent in February as price pressures intensified on a monthly basis despite a broader year-on-year moderation, according to the latest Consumer Price Index report.
The data shows that while inflation remains lower than the 27.35 percent recorded in March 2025, the pace of price increases is accelerating again in the short term.
On a month-on-month basis, inflation surged to 4.18 percent in March from 2.01 percent in February, indicating a sharp increase in the rate at which prices are rising within a single month.
Food, Transport and Services Drive Price Pressure
Food inflation remained a major driver of overall price increase with year-on-year food inflation standing at 14.31 percent, while monthly food inflation eased slightly to 4.17 percent from 4.69 percent, suggesting some moderation in food price spikes.
However, broader inflation pressures were driven by key sectors, particularly:
- Food and non-alcoholic beverages
- Restaurants and accommodation
- Transport
- Health and housing-related costs
These sectors contributed the most to headline inflation, highlighting the continued impact of energy costs and logistics on consumer prices.
Core Inflation Signals Persistent Underlying Pressure
Core inflation, which excludes volatile agricultural and energy prices, rose to 16.21 percent year-on-year, while accelerating sharply on a monthly basis to 4.03 percent from 0.89 percent.
This suggests that inflation is no longer driven solely by food prices but is becoming more broad-based across the economy.
Rural Inflation Outpaces Urban Price Growth
The data shows a widening gap between rural and urban inflation trends, with rural inflation rising to 17.22 percent year-on-year, compared to 14.64 percent in urban areas.
On a monthly basis, rural inflation surged to 6.73 percent, higher than 3.16 percent recorded in urban areas.
This divergence points to deeper structural challenges in rural supply chains, including transportation costs, insecurity and distribution inefficiencies.
State-Level Inflation Shows Sharp Variations
Inflation trends varied across states with Bayelsa, Sokoto and Bauchi recording the highest year-on-year inflation rates, while Osun, Kano and Kaduna recorded the lowest increases.
On a monthly basis, Zamfara, Bauchi and Sokoto recorded the fastest price increases, while Lagos, Akwa Ibom and Rivers posted the slowest rises, indicating uneven inflation pressure across the country.
What This Means for the Economy
The latest inflation data presents a mixed outlook.
While the year-on-year slowdown suggests that earlier policy tightening and base effects are beginning to moderate inflation, the sharp rise in monthly inflation signals renewed short-term pressure driven by:
- Rising energy costs
- Transportation expenses
- Supply chain disruptions
The increase in core inflation also indicates that inflationary pressure is becoming more entrenched, extending beyond food prices into broader economic activity.
Market and Policy Implications
The acceleration in monthly inflation is likely to influence monetary policy decisions with the Central Bank expected to maintain a tight stance to contain price pressures and stabilise the naira.
Higher inflation also reduces real purchasing power, potentially weakening consumer demand and slowing growth in non-oil sectors.
For investors, the data suggests continued pressure on interest rates, fixed income yields and consumer-facing sectors, while reinforcing the importance of inflation-hedged assets.
Investors King Note
Nigeria’s inflation trend is showing early signs of stabilisation on a yearly basis, but the sharp increase in monthly prices indicates that inflationary pressure is far from over.
The combination of rising core inflation, strong rural price growth and persistent cost pressures suggests that inflation will remain a key macroeconomic risk in the near term, requiring sustained policy intervention to achieve long-term stability.
