Nigeria’s inflation picture is showing mixed signals as headline inflation continues to slow while food prices rise at a much faster rate.

The National Bureau of Statistics (NBS) reported a 50-basis-point decline in headline inflation to 15.43 per cent in July. At the same time, food inflation climbed from 17.52 per cent to 20.31 per cent.

The latest figures suggest that the easing in overall inflation has not yet translated into lower food costs for households. Food remains one of the largest expenses for many families, making the increase a major concern for household purchasing power.

Building Material Prices Surge as Inflation, FX Crisis Push Construction Costs Higher

Food inflation records sharp monthly increase

Food inflation also recorded a significant month-on-month increase in July.

The rate reached 5.56 per cent, compared with 3.75 per cent in June and 2.98 per cent in May. This marked the strongest monthly increase since the rebasing of the Consumer Price Index.

The year-on-year trend has also moved higher for six consecutive months. Food inflation started the year at 8.9 per cent but has since more than doubled.

The latest increase adds to concerns that food prices could remain a major source of pressure even as other parts of the inflation basket begin to stabilise.

Core inflation offers some relief

Core inflation provided a different picture in July.

The measure fell to 14.97 per cent, its lowest level since January 2025. The decline could support the Central Bank of Nigeria’s assessment that underlying price pressures are gradually becoming more stable.

The Monetary Policy Committee has maintained the Monetary Policy Rate between 26.5 and 27.5 per cent over the past year.

Money balances increased from N117.24 trillion to N133.25 trillion by June, representing year-on-year growth of 13.7 per cent. Private-sector credit also rose from N76.13 trillion to N83.26 trillion during the period.

The August inflation report will provide the MPC with newer data before its September meeting.

Transport costs add to food prices

High transport and energy costs remain important factors behind the food price increase.

Diesel prices have almost doubled since the end of February, according to the report. Diesel is widely used by logistics operators, making changes in its price important for the cost of moving agricultural goods.

Petrol prices have also increased by about 50 per cent since early March. Higher fuel costs can raise the cost of transporting food from farms to wholesale markets and then to consumers.

Insecurity in major food-producing areas has also created supply challenges. Economists, including Centre for Promotion of Private Enterprise Chief Executive Dr Muda Yusuf, have identified insecurity and logistics problems as structural issues affecting food prices.

Heavy rainfall may have added further pressure by making road transport and food distribution more difficult.

State inflation rates show wide gaps

The national inflation figure also hides major differences between states.

Adamawa recorded the highest headline inflation rate in July at 33.03 per cent. Yobe followed with 25.2 per cent, while Anambra recorded 24 per cent.

Nasarawa had the lowest headline inflation rate at 7.9 per cent. Kebbi and Borno followed with 9.1 per cent each.

Food inflation was particularly high in Adamawa, where it reached 51.4 per cent. Katsina recorded 30.8 per cent, while Zamfara posted 30.7 per cent.

The NBS has warned that state-level inflation figures should not be compared directly because household spending patterns vary across locations.

Housing costs face indirect pressure

The continuing rise in food prices also has wider implications for Nigeria’s housing sector.

When families spend more on food and transport, they have less money available for rent, mortgage payments, savings and home purchases. This can make housing affordability more difficult, especially for low- and middle-income households.

Developers also face higher operating costs when fuel, transport and other inputs become more expensive. These costs can affect construction budgets and, ultimately, the prices of new homes.

The July inflation figures therefore present a mixed outlook. While lower headline and core inflation point to improving price stability, rising food costs show that many Nigerians continue to face strong pressure on their household budgets.

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More Nigerians are turning to bank loans to finance the purchase and construction of homes, with demand for housing-related credit recording a notable increase in the second quarter of 2026.

The development was disclosed by the Central Bank of Nigeria (CBN) in its Credit Conditions Survey Report for Q2 2026, which showed increased demand for loans across several segments of the economy, particularly housing and small-business financing.

According to the report, demand for credit to purchase houses rose to 9.6 index points during the quarter. Mortgage and re-mortgage lending to households also increased to 13.3 index points, indicating stronger demand for formal financing for housing-related needs.

The increase comes as households continue to face significant financial pressure from rising construction costs, property prices and other living expenses. For many Nigerians, access to bank financing can provide an alternative to paying the full cost of a property or construction project upfront.

The CBN report also recorded broader growth in secured lending. Overall demand for secured credit increased to 15.1 index points, while demand for corporate lending reached 15.2 index points.

Small businesses recorded one of the strongest increases in demand for credit, with lending rising to 26.4 index points. Lending to medium-sized private non-financial companies also increased to 25.5 index points, while credit to large private non-financial companies rose to 8.9 index points.

Consumer lending also strengthened during the period. The CBN reported that consumer loans to households increased to 11.2 index points, while household overdrafts and personal loans rose to 7.9 index points. Credit card lending, however, declined to -2.0 index points.

The improvement was not limited to demand. The report indicated that banks experienced lower default rates across secured and unsecured lending, while repayment performance also improved among small businesses and various categories of private companies.

The rise in housing credit demand could be significant for Nigeria’s housing market. Mortgage finance remains an important component of any effort to expand homeownership, particularly where property prices are too high for households to rely solely on personal savings.

However, stronger demand for housing loans does not necessarily mean that housing has become more affordable. Higher borrowing costs can still limit access to mortgages, while the underlying cost of land, construction materials and property development continues to influence the final price of homes.

The latest CBN figures therefore point to two developments happening at the same time. Nigerians are increasingly seeking formal credit to meet their housing needs, while the affordability challenge continues to make access to suitable housing difficult for many households.

For Nigeria’s housing sector, the long-term impact will depend not only on the availability of credit but also on whether financing becomes affordable enough for more households to qualify and whether increased lending translates into greater housing supply.

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The Nigeria Deposit Insurance Corporation (NDIC) has commenced the payment of insured deposits to customers of 46 microfinance banks (MFBs) whose operating licences were recently revoked by the Central Bank of Nigeria (CBN). The move is part of the corporation’s statutory responsibility to protect depositors and ensure confidence in Nigeria’s financial system.

According to the NDIC, eligible depositors are receiving their insured deposits through an automated payment process linked to their Bank Verification Numbers (BVNs) and alternative bank accounts. The corporation explained that this approach is intended to speed up reimbursements and reduce the need for customers to visit its offices physically.

The corporation also disclosed that it has intensified efforts to recover outstanding loans and dispose of the assets of the failed institutions. These recoveries are expected to fund additional payments to depositors whose account balances exceeded the maximum insured limit provided under the NDIC Act.

The 46 microfinance banks lost their licences after the CBN determined that they no longer met the regulatory requirements for continued operation. Following the revocation, the NDIC automatically assumed the role of liquidator, taking responsibility for closing the institutions, verifying claims, reimbursing depositors, and managing the liquidation process in accordance with the law.

The NDIC urged affected customers to cooperate during the claims process and ensure that their banking information is accurate to facilitate prompt payment. It also warned members of the public against carrying out transactions with the affected institutions or interfering with their records and assets, noting that such actions could attract legal sanctions.

Financial analysts said the prompt settlement of insured deposits is critical to maintaining confidence in Nigeria’s banking system, particularly within the microfinance sector, which provides financial services to millions of small businesses, traders, and low-income households. They noted that an effective deposit insurance system helps protect savers while reinforcing financial stability.

Stakeholders also believe that the orderly liquidation of failed financial institutions demonstrates the effectiveness of Nigeria’s financial safety framework. They stressed that strong regulatory oversight, prudent risk management, and prompt depositor protection remain essential to safeguarding public trust and ensuring the resilience of the country’s banking sector.

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The Nigerian naira recorded gains against the United States dollar on Wednesday, appreciating in both the official and parallel foreign exchange markets.

At the Nigerian Foreign Exchange Market (NFEM), the naira strengthened to N1,369 per dollar, improving from N1,376/$ recorded on Tuesday, according to data released by the Central Bank of Nigeria (CBN).

The development represents a N7 appreciation in the official exchange rate.

In the parallel market, the local currency also appreciated, trading at N1,385 per dollar, compared to N1,390/$ on Tuesday.

Despite the gains in both markets, the exchange rate gap between the official and parallel markets widened slightly to N16 per dollar, up from N14 recorded the previous day.

Meanwhile, trading activity at the official foreign exchange market declined significantly, with interbank turnover dropping by 66.5 per cent to N90.3 million, down from N269.9 million recorded on Tuesday.

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The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks across the country over their failure to meet key regulatory requirements for continued operation.

The apex bank announced the decision in a statement issued by its Acting Director of Corporate Communications, Sidi-Ali Hakama, stating that the revocation took effect from July 1, 2026.

According to the CBN, the action was approved by Governor Olayemi Cardoso in accordance with Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.

The regulator explained that the affected institutions failed to satisfy critical conditions required of licensed financial institutions, prompting the withdrawal of their licences.

The CBN said the affected banks were found to have committed one or more regulatory infractions, including inadequate assets to meet liabilities, prolonged inactivity, closure of operations without regulatory approval, failure to commence business within 12 months of licence issuance, and inability to maintain the minimum capital requirement prescribed by law.

“The revocation of the licences is part of the Bank’s ongoing efforts to safeguard the stability of the financial sector, protect depositors and ensure that licensed institutions comply with current laws and regulatory requirements,” the statement said.

The apex bank reiterated its commitment to maintaining a safe, sound and resilient financial system through strict supervision and enforcement of regulatory standards.

“The Central Bank of Nigeria remains committed to promoting a safe, sound and resilient financial system and will continue to take appropriate supervisory and regulatory actions where necessary to maintain public confidence in the Nigerian financial system,” it added.

Among the affected institutions are Minji-Se Churchill Microfinance Bank (Rivers State), Merchant Microfinance Bank (Abia State), Gold Microfinance Bank (Lagos State), Crystabel Microfinance Bank (Bayelsa State), Creditville Microfinance Bank (Lagos State), OurPass Microfinance Bank (Ondo State), Entrepreneur Microfinance Bank (Lagos State) and Avantus Microfinance Bank (Osun State).

A significant number of the affected institutions are based in Kano State, including Zain Microfinance Bank, Bompai Microfinance Bank, Ajwa Microfinance Bank, NOW NOW Digital Microfinance Bank, Minjibir Microfinance Bank, Shanono Microfinance Bank, Sumaila Microfinance Bank, Rimin Gado Microfinance Bank, Sycamore Microfinance Bank, Tofa Microfinance Bank, Kanopoly Microfinance Bank, Bellbank Microfinance Bank and Esteem Microfinance Bank.

Industry analysts say the move reflects the CBN’s determination to strengthen regulatory compliance, improve financial sector stability and eliminate weak institutions that pose risks to depositors and the broader banking ecosystem.

The development marks one of the largest single licence revocations in the microfinance banking sector in recent years as the regulator intensifies efforts to sanitise Nigeria’s financial services industry.

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The Central Bank of Nigeria’s (CBN) monetary policy decisions continue to shape financial market conditions, as the apex bank maintains a tight stance aimed at stabilising the naira while inadvertently slowing credit expansion and business growth.

Although exchange rate stability remains a key priority, analysts say the prolonged high-interest-rate environment is creating significant pressure on corporate lending and economic activity.

CBN Holds Rates at 26.5% Amid Inflation Concerns

Following its Monetary Policy Committee (MPC) meeting, the CBN maintained the Monetary Policy Rate (MPR) at 26.50 percent, signalling a pause in its aggressive rate-hiking cycle.

Investment analysts at Meristem Securities Limited warn that this decision reinforces a “higher-for-longer” interest rate environment, which will continue to restrict access to credit across sectors of the economy.

Credit Conditions Remain Tight for Businesses and Households

According to analysts, the elevated interest rate level is making borrowing increasingly expensive for both businesses and individuals.

Many firms are now delaying expansion plans, capital projects, and operational investments due to high financing costs.

Households are also reducing borrowing, especially for discretionary spending, as loan repayments become less affordable.

Meristem analysts noted that:

“High cost of borrowing is expected to keep credit creation relatively weak as both lenders and borrowers remain cautious amid still-tight financial conditions.”

Banks Shift Focus to Treasury Income

While the tight monetary environment is slowing lending, it is benefiting commercial banks in other ways.

Banks are expected to record stronger earnings from:

• Government securities
• Treasury bills
• Repriced interest-bearing assets

However, analysts say credit growth will remain weak as risk-averse lending behaviour continues across the financial system.

This means bank profitability is likely to rely more on fixed-income investments than traditional loan expansion.

CBN Defends Tight Monetary Policy

CBN Governor Olayemi Cardoso defended the decision to maintain a restrictive monetary stance, saying exchange rate stability remains essential to controlling inflation.

He noted that recent inflation increases were driven largely by external shocks and described them as temporary.

According to him:

“The centrepiece of our toolkit is ensuring that our foreign exchange rate remains stable.”

Liquidity Flows Into Government Securities

With limited credit expansion in the real economy, excess liquidity is increasingly moving into safer government instruments such as Treasury bills and bonds.

Analysts expect continued strong demand at bond auctions, even as yields remain elevated due to inflationary pressures and government borrowing needs.

Outlook for Investors

Market analysts advise investors to adopt a cautious and selective strategy in the current environment.

They recommend focusing on:

• Strong, defensive stocks
• Companies with stable earnings
• Firms with reliable dividend payouts

In fixed-income markets, continued demand for government securities is expected to support liquidity flow.

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The Economic and Financial Crimes Commission (EFCC) on Monday tendered several newspaper publications as evidence in the ongoing trial of former Central Bank of Nigeria Governor, Godwin Emefiele, over allegations linked to the Naira redesign policy.

The documents were presented at the High Court of the Federal Capital Territory as part of the prosecution’s effort to support claims of alleged disobedience to lawful directives and actions said to have caused injury to the nation.

EFCC Presents Certified Newspaper Exhibits

The EFCC submitted the newspaper materials through a subpoenaed witness, Jegede Oluwasegun, an official of the National Library of Nigeria.

The publications tendered included copies of Punch, ThisDay, Vanguard, Daily Sun, and The Nation newspapers, along with certification receipts issued by the National Library.

The documents were admitted as exhibits without objection from the defence counsel.

Allegations Against Emefiele

Emefiele is facing a four-count charge bordering on alleged disobedience to lawful directives and acts said to have caused public injury.

According to the EFCC, between October 19, 2022 and March 5, 2023, the former CBN governor allegedly approved the printing of 375,520,000 pieces of redesigned N1,000 notes at a cost of over N11 billion without proper approvals from the CBN Board and the President.

The commission said the alleged actions violated Section 19 of the Central Bank of Nigeria Act and were punishable under the Penal Code.

Witness Testimony In Court

During proceedings, prosecution witness Jegede Oluwasegun, led in evidence by Rotimi Oyedepo (SAN), explained his role as a certifying officer at the National Library.

Under cross-examination, the witness admitted he was not the author of the newspaper content and could not verify its accuracy.

“I cannot 100 per cent say the content of the papers is right. I am not the author,” he told the court.

Defence Also Tenders Document

Counsel to the defendant, Olalekan Ojo (SAN), later tendered a ThisDay publication dated January 31, 2023, which was also admitted in evidence without objection from the prosecution.

Court Adjourns Hearing

Justice Maryanne Anenih adjourned the matter to May 12 for continuation of trial proceedings.

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The trial of former Godwin Emefiele continued on Tuesday as a prosecution witness told the court that suspects linked to the case confessed to the fraudulent withdrawal of $6.23 million from the apex bank.

Testifying before the Federal Capital Territory High Court in Maitama, a Commissioner of Police, Eloho Okpoziakpo, said investigations revealed that the funds were illegally withdrawn from the Central Bank of Nigeria (CBN).

Witness Details Investigation

Okpoziakpo, who appeared as the 14th prosecution witness, told the court he was part of a special investigative team led by Jim Obaze, appointed by President Bola Tinubu.

According to him, the team was responsible for interrogating suspects, gathering intelligence, and reviewing documents linked to the alleged fraud.

He stated that some individuals involved in the transaction admitted during questioning that the money was unlawfully withdrawn.

“Investigation revealed that the money was fraudulently taken because some of the suspects confessed,” he told the court.

Controversial Withdrawal Linked to Election Observers

The witness explained that the $6.23 million was reportedly requested for international election observers during the 2023 general elections.

However, he said the Office of the Secretary to the Government of the Federation denied making such a request when contacted by investigators.

He added that documents used to process the withdrawal included a request memo and a letter conveying what was presented as presidential approval under former President Muhammadu Buhari.

Charges Against Emefiele

Emefiele is facing a 20-count charge filed by the Economic and Financial Crimes Commission (EFCC).

The charges include:

• Criminal breach of trust
• Forgery
• Abuse of office
• Conspiracy
• Obtaining money by false pretence
• The alleged offences involve $6.23 million.

The EFCC also accused the former CBN governor of conferring corrupt advantages on two companies — April 1616 Nigeria Ltd and Architekon Nigeria Ltd.

Emefiele has pleaded not guilty to all charges.

Key Evidence Presented

The witness told the court that several documents were recovered from the CBN Abuja branch where the funds were withdrawn.

He identified exhibits detailing:

• The disbursement of the funds in $100 denominations
• Internal approval memos authorising payment
• Correspondence linked to the request
• Court Adjourns Proceedings

Presiding judge, Justice Hamza Muazu, adjourned the case to July 2, 2026, for continuation of hearing.

The court had earlier issued a subpoena directing both the witness and lead investigator to testify and present evidence relating to the case, including materials connected to the naira redesign policy.

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The Central Bank of Nigeria has increased the fee for issuing and replacing ATM debit and credit cards by 50 percent, raising it from N1,000 to N1,500.

At the same time, the apex bank has scrapped the N50 monthly maintenance charge previously applied to naira-denominated debit and credit cards.

New Charges Framework Introduced

The changes were outlined in the apex bank’s Exposure Draft of the Guide to Charges by Banks and Other Financial Institutions (OFIs) 2026, which seeks to update banking fees and promote digital financial services.

Under the revised framework:

• ATM card issuance/replacement now costs N1,500
• Monthly maintenance fees on naira cards have been eliminated
• Virtual debit cards will be issued at no cost
• Charges for premium cards will remain negotiable

However, customers using foreign currency-denominated cards will still pay an annual maintenance fee of $10.

Merchants to Bear Transaction Costs

The CBN also clarified that cardholders will no longer bear costs for transactions at merchant locations.

Instead, the Merchant Service Charge (MSC) will be paid entirely by merchants, set at 0.5 percent per transaction, with a cap of N10,000.

This means customers making payments via Point of Sale (PoS) terminals will not be charged directly for those transactions.

Policy Aims and Financial Inclusion Drive

In a circular signed by Dr. Rita Sike, Director of the Financial Policy and Regulation Department, the CBN said the review aligns with its mandate to ensure a stable financial system.

The apex bank noted that the revised guide is designed to:

• Encourage adoption of electronic payment channels
• Support innovation in financial services
• Expand financial inclusion
• Reduce transaction costs for low-value payments

The update also reflects changes in Nigeria’s financial ecosystem since the last guideline issued in 2020, including the rise of fintech players and digital banking solutions.

Implications for Customers and Banks

While the increase in card issuance fees may raise short-term costs for customers, the removal of monthly maintenance charges is expected to reduce long-term banking expenses.

Analysts say the move could further accelerate the shift toward cashless transactions, as the CBN continues efforts to deepen digital payment adoption across Nigeria.

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The naira recorded mixed performance across foreign exchange markets, appreciating slightly in the parallel market while weakening at the official window, according to latest market data.

In the parallel market, the local currency strengthened to N1,387 per dollar, improving from N1,389 recorded last Friday, indicating a marginal gain for the naira in informal trading.

However, at the Nigerian Foreign Exchange Market, the naira depreciated to N1,349.7 per dollar, compared to N1,342.5 per dollar at the close of the previous week.

Figures released by the Central Bank of Nigeria showed that the N7.2 decline reflects sustained pressure within the official segment despite ongoing liquidity management efforts.

As a result of the contrasting movements, the gap between the parallel and official exchange rates narrowed to N37.3 per dollar from N47.5 recorded last week, suggesting gradual convergence between both markets.

Meanwhile, activity in the official market dropped significantly, with interbank turnover declining to N18.77 million, representing an 84.9 per cent fall from N124.3 million recorded in the previous session.

Analysts say the reduced trading volume may indicate cautious participation among market players, even as the broader outlook points to ongoing adjustments driven by policy direction and global currency trends.

The latest figures highlight the continued volatility in Nigeria’s foreign exchange market, as authorities intensify efforts to stabilise the naira and improve confidence in the system.

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