Cowry Asset Management Limited has projected that Nigeria’s headline inflation rate will moderate to 15.8 per cent in June 2026.

The firm cited improving food supply conditions, relative stability in the foreign exchange market and softer global crude oil prices as key factors expected to support a gradual easing of price pressures.

However, it cautioned that risks to the inflation outlook remained, particularly from elevated core inflation, high transportation costs, weather-related disruptions to agricultural production and potential volatility in the foreign exchange market.

The projection followed the latest consumer price index (CPI) report released by the National Bureau of Statistics (NBS), which showed that Nigeria’s headline inflation rate rose to 15.93 per cent year-on-year in May 2026 from 15.69 per cent recorded in April 2026.

The 0.24 percentage-point increase marked the third consecutive monthly rise in annual inflation and was largely driven by renewed supply-side pressures, including global commodity price disruptions linked to geopolitical tensions in the Middle East.

Despite the increase in the annual inflation rate, the pace of price growth slowed every month. Headline inflation moderated to 1.75 per cent in May from 2.13 per cent in April, indicating a slower rate of increase in consumer prices during the month.

According to Cowry, the moderation was mainly supported by easing food price pressures, given the significant weight of food items in Nigeria’s inflation basket.

The firm noted that while inflation has recorded a recent upward trend, it remains significantly lower than the 26.06 per cent recorded in May 2025, reflecting improved price stability driven by favourable base effects, exchange rate stability and easing supply constraints.

Food inflation, which remains a major contributor to overall inflation, declined sharply to 16.96 per cent year-on-year in May 2026 from 24.55 per cent recorded in the corresponding period of 2025. Month-on-month food inflation also eased to 2.98 per cent from 3.63 per cent in April.

The investment firm attributed the moderation in food inflation to slower price increases across major staples such as maize, onions, tomatoes, cassava products, pepper, wheat and cowpea, suggesting that improvements in food supply conditions are beginning to have a positive impact on consumer prices.

Cowry said the May inflation report presented a mixed picture for the economy. While annual inflation has continued to moderate compared to the previous year, short-term price pressures remain evident.

The firm noted that the easing in food inflation offers some relief to households, but persistent pressures in core inflation underscore the need for sustained policy measures aimed at reducing structural costs, improving productivity and maintaining macroeconomic stability.

It also maintained that if current improvements in food supply, exchange rate stability and global commodity prices are sustained, inflationary pressures are likely to ease further in the coming months, supporting its forecast of a 15.8 per cent headline inflation rate for June 2026.