Nigerian households under pressure as rising prices squeeze incomes – CBN survey

Nigerian households are becoming increasingly worried about the state of the economy, as rising prices and financial strain continue to bite, according to the Central Bank of Nigeria’s (CBN) March 2026 Household Expectations Survey.

The report shows that the overall consumer confidence index fell sharply to -10.3 points in March, down from 0.8 points in February, marking the first negative reading since November 2025 and signalling a deterioration in the macroeconomic outlook.

This decline was driven by worsening perceptions of both the broader economy and household finances. The economic conditions index dropped to -14.5 points, while the family financial situation index stood at -14.7 points, reflecting growing strain on the household budget.

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CBN disclosed in its March inflation survey that households earning above N200,000 monthly had the highest proportion of respondents who perceived inflation as high.

However, the household expectation survey revealed that households reported a sharp increase in perceived prices, underscoring persistent inflation concerns. The consumer sentiment index on price changes rose to 40.0 points in March, indicating that most respondents observed higher prices compared to the previous month.

Data shows that the index for average prices of selected items rose to 44.2 points, nearly doubling from February’s 23.7 points, with increases seen across key categories such as food, electricity, education, and telecommunications.

Faced with rising prices, households are prioritising basic needs. Respondents indicate that food remains the largest spending category, with an index of 67.6 points in the current month, and is expected to remain dominant over the next six months.

“Transportation, education, and electricity also rank high in planned spending, reflecting a concentration of household budgets on essentials rather than discretionary consumption,’ it said.

Big-ticket purchases decline

Consumer appetite for major purchases remains weak. The report shows deeply negative sentiment across categories such as housing, vehicles, and appliances, with indices for house purchases (-55.9 points) and car purchases (-54.4 points) among the lowest.

Similarly, the buying conditions reveal that indices for consumer durables, vehicles, and real estate all remain below the 50-point threshold, indicating that most households consider it a bad time to make large purchases.

Buying intentions are equally subdued, with indices as low as 19.0 points for real estate, reflecting widespread hesitation amid economic uncertainty.

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Households brace for tougher economy

In February 2026, Nigeria’s headline inflation rate eased marginally to 15.06 percent year-on-year, down from 15.10 percent in January, according to the National Bureau of Statistics. While annual inflation slowed, monthly pressures increased, with food inflation, which was driven by higher prices for staples.

Inflation expectations continue to shape sentiment. According to the survey, 66.4 percent of respondents believe the economy would weaken if prices rise faster, highlighting strong sensitivity to inflation shocks.

At the same time, 41.9 percent of households reported rising borrowing costs over the past three months, while 37.9 percent expect interest rates to increase further, reinforcing concerns about tightening financial conditions.

Despite this, a majority of respondents (61.3 percent) expressed a preference for lower interest rates, even as nearly half (48.6 percent) acknowledged that higher rates may be needed to control inflation.