Nigeria’s headline inflation has slowed for the second consecutive month thanks to a drop in food prices driven by the harvest season.

Data from the Nigerian Bureau of Statistics (NBS) puts August’s headline inflation at 32.15%, down from 33.40% recorded in August. Food inflation also slowed to 37.52% from 39.53% in July 2024.

Although the August inflation rate is  far from the CBN’s 21% target, the reading could see the Central Bank  hold interest rates at their monetary policy committee meeting on September 23. The MPC in June increased borrowing rates to about 26.25%.

Analysts expect that recent increases in fuel prices will affect inflation for the coming months. Nigeria raised fuel prices by 40% after two months of fuel scarcity. The Nigerian National Petroleum Company (NNPC) admitted that it owed petrol suppliers.

“Recent policy changes impacting petrol prices and the value of the naira could trigger an uptrend in the inflation rate in the coming months,” said Samuel Onyenkanmi, an analyst at Norreberger. 

The slowdown in Nigeria’s headline inflation will provide some ease to Nigerians who have endured high living costs. In August, hundreds of citizens protested demanding lower electricity tariffs and the reinstatement of fuel subsidies. 

“To alleviate currency and inflation pressures in Nigeria, closer policy coordination between fiscal and monetary authorities is essential,” Dumebi Oyewole, Senior Economist at Stears, told TechCabal.