January inflation moderation: CPPE expresses mixed feelings

…says moderation in food prices benefits to consumers, threat to farmers’ incomes

The Centre for Promotion of Public Enterprise (CPPE) has expressed mixed feelings on the disinflationary trend in the nation’s economy, in the past few quarters, noting that while the development, especially moderation in food prices, benefits consumers, it poses a major threat to farmers’ income and rural economic stability.

The Centre, in its review paper of January 2026 Nigeria’s Inflation Moderation, signed by its Chief Executive Officer, Dr. Muda Yusuf, noted that the ‘significant moderation’ in Nigeria’s inflation dynamics, as reflected in the Consumer Price Index for January 2026, represents an important macroeconomic shift.

This development, it argued, would have implications for household welfare, agricultural income sustainability, monetary policy direction, and private-sector investment strategy.

The organisation noted that the sharp decline in food inflation to 8.89 percent year-on-year, down from 29.63 percent in January 2025 and 10.84 in December 2025, carried substantial welfare benefits, since food accounts for the largest share of household expenditure in Nigeria.

It added that besides improving real purchasing power, particularly for low-income households, food disinflation would also go a long way in reducing poverty and food security pressures and supporting gradual recovery in consumer demand for non-food goods and services.

“If sustained, these developments could stimulate retail trade, manufacturing utilisation, and service-sector activity, thereby supporting broader economic recovery,” it stated.

The centre, however, noted that though of immense gains to consumers, sustained weakness in farm prices may reduce revenues and investment capacity of farmers, weaken rural purchasing power, discourage agricultural production and potentially create future supply shortages and renewed inflation pressures.

It stressed the need to balance consumer affordability with producer sustainability to safeguard national food security.

“Government should deploy targeted measures to protect farm incomes while sustaining food affordability, including productivity support, minimum guaranteed prices for selected crops, strategic reserves, and expanded agro-processing capacity to absorb surplus output,” it added.