Energy costs remain the biggest factor influencing inflation perceptions among Nigerian households and businesses, even as expectations of further moderation in price pressures improve, according to the Central Bank of Nigeria (CBN).
The finding is contained in the CBN’s July 2026 Inflation Expectation Survey, which examined how firms and households perceived inflation and its major drivers during the month.
The survey showed that 60.9 per cent of businesses reported increased expenditure as a result of inflation in July, compared with 55.9 per cent of households.
Energy costs, covering petrol, diesel and electricity, recorded the highest inflation perception score among both groups, at 74.1 points for firms and 61.9 points for households.
For businesses, insecurity was the second-largest factor at 71.3 points, followed by interest rates at 69.0 points and exchange-rate movements at 68.8 points.
Among households, transportation ranked second at 61.2 points, while insecurity and exchange-rate movements recorded 56.5 and 54.1 points, respectively.
The CBN said respondents nevertheless expected inflation-related expenditure to gradually decline over the next six months, with businesses expressing greater optimism than households about an easing of price pressures.
The survey’s Inflation Perception Index stood at 40.0 points in July, indicating that respondents perceived inflation to have moderated compared with the previous month.
Similarly, the Inflation Expectation Index is projected to fall to 21.2 points in August, suggesting that households and businesses expect inflationary pressures to ease further.
The survey also revealed differences across income groups. Households earning between N150,001 and N250,000 recorded the highest perception of inflation at 71.0 per cent, while those earning between N350,001 and N450,000 recorded the lowest at 55.6 per cent.
The latest findings come amid a marginal moderation in Nigeria’s headline inflation, which fell to 15.91 per cent in June from 15.93 per cent in May, according to the National Bureau of Statistics.
Despite the improvement in inflation expectations, the continued dominance of energy costs in the survey highlights the persistent impact of fuel, electricity and other energy-related expenses on household finances and business operating costs.
The CBN said natural disasters, raw materials or household purchases, and infrastructural challenges were perceived as relatively less significant contributors to inflation during the review period.
The National Bureau of Statistics is expected to release the August 2026 Consumer Price Index on August 17, which will provide further evidence of whether the easing reflected in inflation expectations is translating into lower measured inflation.
