The Centre for the Promotion of Private Enterprise (CPPE) has warned against further monetary tightening by the Central Bank of Nigeria (CBN), saying Nigeria’s inflation challenge is being driven largely by structural and supply-side factors that higher interest rates alone cannot solve.
The CPPE Chief Executive Officer, Dr Muda Yusuf, who is a renowned economist, gave the warning following the release of Nigeria’s April 2026 inflation figures by the National Bureau of Statistics (NBS) on Friday, May 15.
His warning came ahead of the Central Bank of Nigeria (CBN) bi-monthly Monetary Policy Committee (MPC) meeting slated to be held before the end of the month.
According to Yusuf, although headline inflation rose slightly from 15.38 per cent in March to 15.69 per cent in April, there are signs that short-term inflationary pressures may be easing.
He noted that month-on-month inflation indicators showed moderation across key segments of the economy, with headline inflation declining by 2.05 per cent, food inflation easing by 0.54 per cent, core inflation dropping by 3.0 per cent, urban inflation slowing by 1.3 per cent, and rural inflation falling sharply by 3.9 per cent.
“Nigeria’s inflation outlook in April 2026 reflects a fragile disinflation process amid mounting global and domestic cost pressures,” Yusuf said.
He described the moderation in month-on-month inflation figures as encouraging but warned that inflation conditions remain severe for households and businesses.
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He noted that food inflation stood at 16.06 per cent while core inflation remained high at 15.86 per cent, with food, transportation, energy, healthcare and restaurant services accounting for about 87 per cent of the inflationary pressure recorded in April.
“These are essential expenditure items which absorb the bulk of household income, particularly among low-income Nigerians,” Yusuf said.
He also raised concerns over the impact of rising geopolitical tensions involving Iran, Israel and the United States, warning that renewed volatility in the global oil market could worsen inflationary pressures in Nigeria.
“The conflict has triggered renewed volatility in the global oil market, pushing up crude oil prices and transmitting higher energy costs into the domestic economy,” he said.
He explained that rising petrol, diesel and cooking gas prices are increasing transportation, logistics and production costs across sectors, with significant effects on food prices and overall consumer inflation.
According to Yusuf, the current inflation trend further highlights the structural nature of Nigeria’s inflation problem, stressing that tightening monetary policy alone would not address challenges linked to energy costs, logistics bottlenecks, food supply disruptions and weak infrastructure.
“Additional monetary tightening could worsen financing costs for businesses, weaken investment and further constrain productivity growth,” he warned.
The CPPE boss urged the government to focus more on supply-side interventions aimed at reducing energy costs, improving transportation infrastructure, strengthening food supply systems, enhancing trade facilitation and boosting domestic productivity.
He also said businesses are operating under extremely difficult conditions and advised firms to adopt strategies such as energy efficiency, dynamic pricing and affordability-driven product models as consumers become increasingly price-sensitive.
“Overall, the April inflation numbers suggest that while inflationary momentum may be moderating, the disinflation process remains highly vulnerable to external shocks, especially geopolitical developments in the global energy market,” Yusuf said.
He added that sustained moderation in inflation would depend largely on structural reforms and targeted measures to reduce the cost of food, transportation and energy across the economy.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X