Nigeria’s headline inflation rate slowed slightly to 21.88% in July 2025, marking a modest retreat from the previous month’s figure of 22.22%, according to the latest data released by the National Bureau of Statistics (NBS). On a month-on-month basis, headline inflation rose to 1.99% in July 2025, which was 0.31% higher than the 1.68% recorded in June 2025. This indicates that the rate of increase in the average price level in July was higher than in June. The percentage change in the average CPI for the twelve months ending July 2025 was 25.65%, showing a decline of 5.11% compared to the 30.76% recorded in July 2024. Core inflation, which excludes volatile agricultural products and energy, stood at 21.33% in July 2025 on a year-on-year basis, a decline of 6.13 percentage points from 27.47% in July 2024. On a month-on-month basis, core inflation dropped sharply to 0.97% in July 2025, down by 1.49% from 2.46% in June 2025. Food inflation slowed to 22.74% in July 2025 on a year-on-year basis, down significantly by 16.79 percentage points from the 39.53% recorded in July 2024. The sharp drop was partly attributed to the change in the base year. On a month-on-month basis, food inflation was 3.12% in July 2025, a slight decline of 0.14% compared to 3.25% in June 2025.
https://www.digital.zenithbank.com/ZEQ/ZEQ-jan-2026/index.html#p=1Money Market
System liquidity opened the week with a surplus of ₦313.93 billion, as CRR debit led to a reduction from last week’s level. Mid-week, liquidity levels slipped further, opening at ₦162.85 billion, before turning negative as the market recorded a deficit of ₦32.23 billion on the back of FX settlements and Remita outflows. The bearish tone persisted, with subsequent openings showing deficits of ₦35.30 billion and ₦94.47 billion by the end of the week. Week-on-week, the Open Buy Back (OBB) rate increased by 560bps to close at 32.10%, while the Overnight (OVN) rates increased by 540bps to close at 32.40%.
We expect rates to moderate in the coming sessions, supported by anticipated OMO maturities and bond coupon inflows, which should temporarily ease funding pressures, barring any unexpected outflows.
Treasury Bills Market
The FGN Treasury Bills market began the week on a calm note, sustaining the prior Friday’s sentiment, with pockets of demand seen across the mid- to long-tenor bills. Early trades were consummated on the 6 Aug bill at 16.20%. As the week progressed, the market turned bullish, with sustained demand driving activity. The 6 Aug bill was quoted at 16.35%/16.15%, while notable trades were executed on the Apr 7 OMO bills at 23.30% and the 23 July bill at 16.10%. Mid-week, the market remained relatively quiet as tight system liquidity constrained activity, though trades were still seen on the August 6 bill at 16.20%. By the end of the week, the market lost steam, closing on a bearish note as liquidity pressures filtered into demand, causing offers to surface. Week-on-week, the average benchmark yield declined by 5bps to close at 18.01%.
We anticipate a quiet start to the week, as market participants are expected to trade cautiously ahead of the NTB auction, where the DMO will be offering ₦230bn across the standard maturities.
FGN Bond Market
The FGN Bonds market opened the week on a quiet note, with limited activity across the curve. Early sessions were largely muted, as yields remained broadly unchanged while market participants stayed on the sidelines in the absence of any clear market-moving catalyst. Midweek, modest demand emerged in the mid-tenor segment, with the 2033 maturity quoted around 16.95%/16.75%. However, sentiment shifted later in the week as bearish pressures surfaced, following the release of the DMO’s revised Q3 issuance calendar. The calendar revealed a doubling of planned borrowings for August and September from ₦120bn to ₦240bn monthly, triggering an influx of offers, particularly on mid-tenor bonds. The 2033s were quoted at 17.45%/17.20% before trading at higher yields of 17.70% as selling interest deepened. Toward the end of the week, renewed buying interest helped the market stabilize slightly, with the 2033 maturity closing around 17.50%. Overall, the market ended the week subdued, reflecting cautious investor sentiment amid supply concerns and the heavy auction calendar ahead. Week-on-week, the average benchmark yield increased by 15bps to close at 16.42%.
We expect a slow start to the week as demand remains dampened.
FGN Eurobond Market
The FGN Eurobonds market opened the week on a muted note, as investors weighed the potential for an end to the Ukraine war amid speculation over a planned U.S.-Russia meeting and traded cautiously ahead of the U.S. CPI release. Sentiment improved mid-week after the CPI print came in at 2.7% y/y, below the 2.8% consensus, spurring demand and reinforcing optimism for a September rate cut. This softer-than-expected reading, coupled with Secretary Bessent’s call for a 50bps cut, drove strong buying momentum and lifted market activity. However, the bullish run was tempered towards the end of the week as attention shifted to the U.S. PPI release. The data printed higher than expected at 3.3% y/y (vs. 2.5% forecast, 2.4% prior), sparking bearish sentiment and trimming expectations of an aggressive Fed cut. The trend extended into Friday, with the PPI print, leading to a marginally bearish tone as bets for imminent rate cuts moderated. Week-on-Week, the average benchmark yield declined by 20bps to 7.78%.
Looking ahead, we expect market activity to remain cautious as participants awaits FOMC Meeting Minutes, U.S. Unemployment Claims, and Flash PMI data, which will provide further direction for Fed policy expectations.
Currency Market
The value of the Naira to the dollar appreciated by 0.07% to close at ₦1532.51/$ at the Nigerian Foreign Exchange Market Window (NFEM).
Equities Market
The local bourse ended the day with the benchmark NGX All-Share Index (ASI) declining by 46bps to close at 144,628.20. Market capitalization also declined, closing at ₦91.51 trillion. Market breadth was negative at 0.77x. Meanwhile, trading activity was robust on the day, as the volume of shares traded declined by 44% to 1.37 billion units, while the total value of shares traded decreased by 37% to ₦13.92 billion.
Reflecting the week’s performance, the NGX All-Share Index recorded a 0.77% depreciation, as gains in MBENEFIT (+31.85%), TRIPPLEG (+30.23%) and SUNUASSUR (+23.80%) were offset by declines in UPDC (-17.72%), LIVINGTRUST (-16.00%), and BERGER (-14.67%). Overall, the NGX has posted a year-to-date gain of 40.52%. Other notable indices are the NGX Top 30 Index (-0.39%; -0.85% 1WK; 38.57% YTD), NGX Banking Index (0.56%; -0.23% 1WK; 47.81% YTD), NGX Oil & Gas Index (-0.69%; -1.42% 1WK; -11.28% YTD), and NGX Insurance Index (-8.73%; 8.21% 1WK; 88.48% YTD).
