Nigeria Inflation Rate Falls to 22.97% in May

Nigeria's inflation rate eased to 22.97% year-on-year in May 2025, down from 23.71% in April, marking the second consecutive month of decline as reported by the National Bureau of Statistics (NBS). Food inflation also decreased slightly to 21.14%, contributing to the overall slower pace of price increases, driven by moderation across key sectors like farm produce, utilities, clothing, and health. This easing follows a rebasing exercise updating the inflation basket base year to 2024, which had previously led to a sharp drop in the inflation rate earlier in the year. The Central Bank of Nigeria maintained its key interest rate for the second consecutive time, citing improved macroeconomic indicators supporting price moderation. Investor sentiment toward Nigerian government bonds improved amid optimism over these macroeconomic trends, with increased demand particularly in mid-to-long dated maturities and a slight decline in average yields. However, trading activity was affected by wide bid-ask spreads despite the positive outlook ahead of upcoming Treasury bills auctions.