CBN Warns Middle East Tensions, Election Spending Could Disrupt Disinflation
By Aboki Forex —
The Central Bank of Nigeria has warned that prolonged geopolitical tensions in the Middle East and election-related spending could put renewed pressure on prices, even as it expects inflation to moderate further in the short to medium term.
The warning was contained in the communiqué of the 307th meeting of the Monetary Policy Committee. The CBN said although the outlook for the domestic economy remained positive, external and domestic risks could undermine the moderation in inflation.
Inflation Eases
The apex bank noted continued decline in headline, food and core inflation. It said headline inflation slowed to 15.39 per cent in August 2026 from 15.43 per cent in July.
Food inflation declined to 19.57 per cent from 20.31 per cent over the same period. Core inflation also moderated to 13.92 per cent in August from 14.97 per cent in July.
Why CBN Expects Further Moderation
The CBN said Nigeria’s inflation rate is expected to moderate further in the short to medium term. It cited improved food supply during the harvest season, foreign exchange stability and the delayed effects of previous monetary tightening.
The bank said the moderation in inflation reflected the impact of previous monetary policy tightening, sustained exchange-rate stability and improved inflation expectations.
Risks To Watch
Despite the positive outlook, the CBN flagged Middle East tensions and election-related spending as risks that could renew pressure on prices. It said these external and domestic risks could undermine the moderation in inflation.
The MPC meeting was the 307th, and its communiqué provided the latest assessment of price pressures in Nigeria.
What It Means
For consumers, the continued slowdown in food and core inflation may offer some relief. For the naira, the CBN tied the outlook to exchange-rate stability, suggesting that any renewed price pressure could complicate the monetary policy path.