The Centre for the Promotion of Private Enterprise has cautioned that persistent increases in food and month-on-month prices signal unresolved structural weaknesses in Nigeria’s economy, despite the recent decline in headline inflation.

In a statement on Sunday, CPPE Director and Chief Executive Officer, Dr Muda Yusuf, described the July 2025 inflation report as a “mixed picture” that calls for caution and sustained reforms.

He noted that headline inflation eased for the fourth consecutive month, dropping from 22.22 per cent in June to 21.88 per cent in July. Food inflation on a month-on-month basis also moderated from 3.25 per cent to 3.12 per cent, while core inflation slowed sharply from 3.46 per cent in June to 0.97 per cent in July.

“These positive trends reflect a gradually stabilising macroeconomic environment, aided by exchange rate stability, improved investor confidence, and import duty waivers on staples such as rice, maize and sorghum,” Yusuf said. He added that the base effect of high inflation in 2022 also contributed to the moderation.

However, he warned that underlying vulnerabilities remain. Month-on-month headline inflation rose to 1.99 per cent in July from 1.68 per cent in June, while year-on-year food inflation climbed from 21.97 per cent to 22.74 per cent. “These movements underscore the continuing vulnerability of the economy to supply-side shocks,” he said.

Yusuf urged government to sustain reforms, ensure exchange rate stability, and implement urgent structural measures to tackle high logistics costs, insecurity, climate risks, and port inefficiencies. He also called for fiscal discipline and innovative monetary policies, noting that lending rates have already exceeded 30 per cent for most businesses.

“The July inflation report provides a basis for cautious optimism,” he said. “But a coordinated mix of monetary, fiscal, and structural interventions will be required to consolidate recent gains and secure lasting stability.”