The Centre for the Promotion of Private Enterprise (CPPE) has released its analysis of the July 2025 inflation report, highlighting a mixed outlook for the Nigerian economy.
According to Dr. Muda Yusuf, Director/CEO of CPPE, the report presents both positive trends and emerging concerns that demand policy attention.
The July 2025 inflation figures show a decline in headline inflation for the fourth consecutive month, easing from 22.22% in June to 21.88% in July, a deceleration of 0.34%.
Month-on-month food inflation also moderated, falling from 3.25% in June to 3.12% in July. Additionally, core inflation posted marginal declines year-on-year and a sharp slowdown month-on-month.
These developments reflect a gradually stabilizing macroeconomic environment, supported by exchange rate stability, improved investor confidence, and the impact of import duty waivers on key staples.
Despite these gains, pressures persist. Month-on-month headline inflation rose from 1.68% in June to 1.99% in July, while year-on-year food inflation inched up from 21.97% to 22.74%. These movements underscore the continuing vulnerability of the economy to supply-side shocks.
The CPPE’s analysis highlights the need for caution and sustained reforms to consolidate recent gains and steer the economy toward sustained stability.
Key priorities include maintaining foreign exchange stability, addressing structural constraints, ensuring fiscal discipline, and implementing monetary innovation.
Dr. Muda Yusuf emphasized that a coordinated mix of monetary, fiscal, and structural interventions will be required to address the economy’s unresolved structural weaknesses.
“The July 2025 inflation report provides a basis for cautious optimism,” he said. “While progress has been made in moderating headline and core inflation, the persistence of food and month-on-month price increases highlights the need for sustained policy attention.”
To achieve sustained stability, the CPPE recommends that policymakers focus on maintaining calm in the FX market, addressing constraints such as high logistics and import costs, insecurity, climate risks, and port inefficiencies.
Additionally, prudent government spending and effective liquidity management will be crucial in preventing inflationary pressures.
By adopting a coordinated approach, Nigeria can consolidate recent gains and steer the economy toward sustained stability, according to Dr. Muda Yusuf.
The CPPE’s analysis provides a timely reminder of the need for policymakers to remain vigilant and proactive in addressing the economy’s challenges.
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