The Research Department of United Capital Plc has projected a marginal increase in Nigeria’s headline inflation rate to 15.95 per cent in June 2026, up from 15.93 per cent recorded in May.
The projection is contained in the company’s June research report, made available to reporters on Thursday in Lagos.
According to the report, the expected rise is largely driven by higher prices of some food items, particularly tomatoes, although the impact was moderated by lower prices of Premium Motor Spirit (PMS).
The report noted mixed movements in food prices in June compared to May.
“Logistics costs dropped as easing geopolitical tensions drove down global crude oil prices. Meanwhile, the price of tomatoes increased significantly,” it stated.
“Since tomatoes form a major component of cooking in the average Nigerian household and most restaurants, the increase usually exerts upward pressure on consumer expenditure and, consequently, inflation.
“The rise in tomato prices in June was mainly due to reduced supply, as the dry season harvest has ended and the rainy season is now in full swing.”
The report also noted that yam prices increased by eight per cent in June compared to May, while prices of rice and beans declined.
Rice prices fell marginally for both local and imported varieties, while beans prices dropped by five per cent.
If the projection materialises, it would mark the fourth consecutive monthly increase in the country’s inflation rate ahead of the Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) scheduled for July 20 and 21.
The report, however, questioned whether the MPC would respond with further monetary policy tightening.
It attributed the moderation in inflationary pressures to lower fuel prices, supported by easing geopolitical tensions that reduced crude oil prices.
The average price of Bonny Light crude declined by 21.81 per cent to $87.70 per barrel in June from $112.16 per barrel in May. Similarly, the average pump price of PMS fell by five per cent to N1,249 per litre from N1,312 per litre in May.
United Capital projected that inflation would remain within the 15 per cent range between July and October, with gradual moderation expected as the harvest season improves food supply.
“Recent increases in tomato and yam prices largely reflect seasonal supply constraints associated with the onset of the rainy season. As harvest activities improve food supply, inflationary pressures are expected to ease, making June 2026 a likely seasonal peak rather than the beginning of a sustained upward trend,” the report stated.
The research firm advised the MPC to retain current policy rates at its July meeting, noting that the CBN is more likely to continue managing liquidity through Open Market Operations than implement another rate hike.
It added that fixed-income yields are expected to remain broadly stable in the short to medium term, barring major inflation or policy surprises.
The report also noted that the recent correction in the equities market has created opportunities for a rebound as investors reposition ahead of the release of half-year corporate earnings.
On the foreign exchange market, the naira appreciated marginally by 0.2 per cent on a monthly average basis, improving from N1,370 per dollar in May to N1,367 per dollar in June. However, it weakened slightly at the official closing rate, depreciating to N1,380 per dollar from N1,373 per dollar in May.
