Contrary to expectations, Nigeria’s headline inflation maintained its downward trajectory in January 2026, easing slightly to 15.10% year-on-year, down from 15.15% in December 2025. This marks the tenth consecutive month of disinflation, reflecting a sustained moderation in price pressures. While the year-on-year decline was modest, the month-on-month data tells a more striking story: consumer prices contracted by 2.88% in January, highlighting a notable softening in short-term inflation.

Several factors contributed to this moderation. The decline in PMS prices in December by the Dangote Refinery (even though prices were revised upwards in February), helped lower logistics costs and eased cost-push pressures across both food and core items. In addition, the Naira strengthened in January, creating a pass-through effect that helped moderate imported inflation. Improved commodity supply following the harvest season also bolstered market inventories, easing food price pressures. On the demand side, consumer spending normalized after the December festive surge, reducing short-term demand-pull pressures.