Analysts Forecast Lower Inflation Rate on Improved Food Supply

Analysts predict a further decline in Nigeria's inflation rate due to improved food supply during the ongoing harvest season and stability in the foreign exchange market. Coronation Merchant Bank's latest Inflation Outlook for August projects a decrease in headline inflation to 16.4% from the 17.38% recorded in July.

The bank attributes this decline to early harvests of staple crops like maize and groundnut, particularly in the southern region, which have helped soften food prices. Exchange rate stability has also played a role in supporting disinflation by reducing the cost of imported food items.

These factors are expected to ease inflationary pressures on the food basket, contributing to a more favorable inflation outlook in the coming months.