RFA Breakfast Paper - May 15, 2026
Nigeria's Inflation Climbs to 15.69% as Fuel Shock Continues to Bite
Annual inflation in Nigeria rose for a second consecutive month to 15.69% in April 2026, the highest level since November 2025, up from 15.38% in March. The increase reflected the continued pass-through from the March fuel price shock linked to the Middle East conflict, which pushed up transport costs, food prices, and exchange rate pressures. Food inflation accelerated for a third straight month to 16.06%, driven by higher prices for staples such as millet, yam flour, ginger, beef, garri, tubers, and pepper. Transport inflation remained elevated at 16%, following a sharp 16.9% rise in March. Additional pressure came from restaurants & hotels (27.9% vs 25.2%) and healthcare-related costs. However, underlying inflation showed some moderation, with core inflation easing to 15.86% from 16.21%, suggesting that broader price pressures outside food and energy softened slightly. On a month-on-month basis, CPI rose 2.13%, slowing from the 4.18% spike recorded in March, indicating that the pace of inflation acceleration may be moderating even as headline inflation continues to rise.
U.S. Markets Pull Back as Tech Profits Fade and Bond Yields Climb Higher
U.S. equities ended lower as the recent technology-led rally lost momentum, with investors locking in gains after a strong run. The pullback came as rising government bond yields added pressure to risk assets, with the 2-year Treasury climbing to 4.08%. Sentiment was also shaped by developments from the meeting between Donald Trump and Xi Jinping in China, where both sides signaled a continuation of the trade truce. While discussions were broadly constructive and helped ease fears of further escalation, there were no major breakthroughs on tariffs or broader geopolitical issues, including Iran. Sector performance remained uneven, with energy the only clear outperformer, while materials led losses. Bond markets drove much of the risk-off tone as global yields moved higher on renewed inflation concerns, expectations of additional policy tightening, and rising worries over government debt burdens. The U.S. 30-year Treasury yield climbed to its highest level since 2007, highlighting growing pressure in long-duration assets. Higher oil prices also fed into inflation expectations, reinforcing concerns that tighter financial conditions may persist for longer. Despite this, some investors continue to expect central banks, including the Federal Reserve, to look through what could be a temporary energy-driven inflation spike. Still, the recent rise in yields is increasingly viewed as a key constraint on equity valuations, particularly in high-growth sectors that have driven much of the year’s gains.
Weekly Gains Hold Firm Despite Late Selloff as Profit-Taking Weighs on Nigerian Equities
The Nigerian equity market closed the week on a softer note as investors engaged in profit-taking, particularly in medium-cap and blue-chip stocks, dragging key indices lower. Weakness in the Oil & Gas sector amplified the downturn, pushing the NGX All-Share Index down by 1,912.19 basis points, or -0.76%, to close at 250,330.92. Market capitalization also declined by ₦1.23 trillion to settle at ₦160.44 trillion. Despite the negative close, the broader picture remained constructive, as the market still delivered a solid week-on-week gain. The NGX-ASI advanced by +2.27% over the week, with investors’ wealth increasing by approximately ₦3.35 trillion, reflecting underlying strength and sustained buying interest earlier in the week. Market activity, however, painted a more encouraging picture, with trading volumes and values both rising, signalling continued participation despite the pullback. Total volume traded increased by +4.28%, while the total value of transactions grew by +6.36%. Investors exchanged approximately 1.08 billion shares valued at ₦44.29 billion across 65,744 deals. This uptick in activity suggests that while profit-taking pressured prices in the short term, liquidity remained strong, leaving room for potential market stabilization as investors reassess opportunities heading into the new week.
