Inflation pressures across Africa’s largest economies moderated in 2025, reversing the sharp price increases recorded in 2023 and 2024, according to a BusinessDay analysis based on World Bank data.
Tighter monetary policies, easing food and energy prices, and improved currency stability helped slow consumer price growth across much of the continent, providing relief to households and businesses
Inflation Trends Across Africa’s Biggest Economies
The analysis of Africa’s 10 largest economies shows that Morocco recorded the lowest average inflation between January and October 2025 at 0.94 percent, followed by South Africa at 3.15 percent.
Other relatively low-inflation economies included Tanzania (3.33 percent) and Kenya (4.04 percent), while inflation remained elevated in countries such as Ethiopia, Egypt, Ghana, Angola, and Nigeria.
Nigeria, Africa’s most populous nation, recorded an average inflation rate of 14.45 percent in November, marking the eighth consecutive monthly slowdown, according to the National Bureau of Statistics.
Regional Outlook
Excluding Algeria, which recorded episodes of deflation, the nine remaining economies posted an average inflation rate of 10.74 percent in 2025, down from 16.28 percent in 2024 and 15.57 percent in 2023.
The World Bank’s latest Africa Pulse report projects regional economic growth of 3.8 percent in 2025, up from 3.5 percent in 2024, with further acceleration expected in 2026 and 2027.
The report noted that easing inflation has created room for gradual monetary policy relaxation, supporting household consumption and private investment, even as fiscal consolidation remains a constraint in some economies.
Low-Inflation Economies
Morocco
Morocco maintained Africa’s lowest inflation in 2025, supported by lower food prices, easing imported inflation, and subdued core price pressures. The central bank kept its policy rate at 2.25 percent to support economic growth.
South Africa
Inflation remained within the central bank’s target range, helped by declining fuel costs and weak domestic demand. The South African Reserve Bank cut its benchmark rate multiple times during the year as price pressures eased.
Kenya and Tanzania
Kenya and Tanzania recorded moderate inflation, driven mainly by food, housing, and transport costs. Both countries maintained accommodative monetary policies to support economic activity.
Moderate- to High-Inflation Economies
Ethiopia
Ethiopia’s inflation slowed to 13.6 percent, down from over 30 percent in 2023, although food prices, currency pressures, and supply constraints continued to pose challenges.
Egypt
Egypt’s urban inflation declined to 14.4 percent, reflecting tight monetary policy and IMF-backed reforms following earlier currency devaluations.
Ghana
Ghana recorded inflation of 15.4 percent, supported by a stronger cedi and improved export earnings from cocoa and gold. The central bank responded with significant rate cuts as price pressures eased.
High-Inflation Markets
Angola
Inflation in Angola remained elevated at 20.8 percent, driven by food and energy costs, import dependence, and currency volatility, despite gradual monetary easing.
Notable Exception: Algeria
Algeria stood out as the only country to record negative inflation, with consumer prices falling by 0.40 percent in parts of 2025. The deflation reflected weak domestic demand and subdued price pressures.
