MoneyAfrica| Investment Research
Weekly Market Commentary
January 19, 2026.
Good morning, readers, and welcome to this week’s edition of our stock market newsletter!
As always, our newsletter is divided into two sections: Green White Green, covering the Nigerian stock market, and the Star-Spangled Banner, focusing on the US market.
Green White Green Recap
Macro Update
Nigeria’s Inflation Eases to 15.15% in December 2025
Nigeria’s latest inflation data suggests the economy is gradually moving out of its most intense inflationary phase. December 2025 figures point to a meaningful slowdown in price pressures, especially when compared with the extreme levels recorded a year earlier.
Headline inflation eased to 15.15% year-on-year, down from 17.33% in November 2025 and significantly lower than 34.80% in December 2024. While part of this sharp decline reflects base effects from the revised Consumer Price Index (CPI) calculation, the data also indicates a real moderation in prices. This is supported by the month-on-month inflation rate, which slowed to 0.54% in December, from 1.22% in November, showing that prices are rising more slowly across the economy.
Food inflation, which has been the biggest source of pressure for households, recorded the strongest improvement. Year-on-year food inflation fell to 10.84%, while the month-on-month reading turned negative at –0.36%, meaning food prices declined slightly compared to the previous month. This reflects falling prices of key staples such as tomatoes, garri, eggs, grains, vegetables, plantain, beans, pepper, and onions. The trend suggests better supply conditions due to bumper food harvests.
Core inflation, which strips out volatile items such as farm produce and energy, fell to 18.6% year-on-year from 20.59% in November 2025. This was driven by a sharp fall in month on month core inflation to 0.58% from 1.28% in November 2025 due to a slowdown in price increases in services.
We expect year-on-year inflation to jump to as high as 19.1% in January 2026 due to base effect—a moderation in prices in January 2025 which is the comparison period in January 2026. While this might seem alarming, do not fret as it is merely a statistical impact and price increases should remain muted between December 2025 and January 2026.
Key Takeaway:
- Inflation is easing, creating an opportunity for investors to lock in high fixed-income yields before rates adjust lower. However, inflation is likely to spike in January 2026 merely due to a statistical impact even though price increases remain moderate.
FX Update
Naira Strengthens as FX Confidence Improves
Last week, the Nigerian naira became slightly stronger against the US dollar. In the official market, the exchange rate improved to ₦1,418 per dollar, up from ₦1,423 in the previous week, meaning the naira gained value. However, in the parallel market, the dollar stayed at ₦1,480, showing stability despite continued demand.
Nigeria’s foreign reserves also increased, rising by 0.5% week on week to $45.9 billion from $45.6 billion for the week ended as of January 15, 2026. This sustained growth can be attributed to stability in Nigeria’s external accounts with the rest of the world and foreign investment inflows as short-term yields fall globally.
Key Takeaway:
- The naira’s modest appreciation and rising foreign reserves suggest improving inflows due to sustained foreign investment flows. Investors can cautiously increase exposure to naira assets while maintaining some dollar hedges, as FX risks have not fully disappeared.
Remember to save dollar-based goals in dollars, which can be done with apps like Ladda. Just visit www.getladda.com to download. You can also earn up to 20% by investing in naira savings.
Equities Update
Banking and Energy Stocks Lead NGX to Another Positive Week
The Nigerian stock market had a strong week, with the NGX All-Share Index rising by 2.36%, a little less than last week’s performance. The gains were driven mainly by industrial goods, oil and gas, and banking stocks. This brought the year-to-date gain up to 6.76%.
Banking stocks rose by 3.45%, supported by strong performances from Fidelity Bank, Wema Bank, UBA, Zenith Bank, and GTCO, as investors show more confidence in strong banking stocks.
The consumer goods sector rose slightly by 1.56%, showing resilience despite notable declines from Nestlé Plc and Dangote Sugar. The industrial goods sector grew by 0.67%, while insurance rose slightly by 1.8% amidst recapitalisation pressure.
The oil and gas sector gained 5.71%, attributed to stocks like Aradel and Seplat Energy.
Overall, market sentiment remains positive, with investors favouring fundamentally strong sectors such as banking and oil and gas despite mixed performance in consumer goods. If earnings momentum and macro stability continue, the market could sustain its upward trend in the near term.
Key Takeaway:
- Investors should focus on strong-performing sectors like banking and oil and gas, which continue to show earnings stability and investor confidence. Caution is advised in consumer goods and insurance, with selective buying of companies that can manage costs and regulatory pressures effectively.
Star-Spangled Banner Recap
Why the Fed Might Cut Rates Again
The Federal Reserve signalled it is prepared to cut interest rates again if the US job market weakens further. Fed Vice Chair Michelle Bowman noted that while economic growth remains solid and inflation pressures are easing toward the 2% target, the labour market has become increasingly fragile and could deteriorate quickly.
This stance suggests the Fed is flexible but not in a hurry, keeping policy moderately restrictive while remaining data-dependent. For investors, this means rates are likely to stay supportive for now, but market volatility could increase if employment data worsens or inflation re-accelerates. Political pressure on the Fed is rising as President Trump prepares to appoint a new Fed Chair, adding policy uncertainty.
Market performance around the world was mixed for the week ended. The S&P 500 declined by 0.06%, FTSE 100 in the UK rose by 1.09%, France’s CAC 40 declined by 1.00%, and Japan’s Nikkei 225 declined by 0.32%. The MSCI World Index rose by 0.09% for this week.
Key Takeaway:
- Investors should remain balanced and selective, maintaining exposure to quality equities while increasing allocations to defensive and income-generating assets amid policy and market uncertainty. With volatility risks rising, diversification and a focus on strong fundamentals are essential.
Remember to always save for your dollar goals in dollars. You can do this with us on Ladda—a fintech app that helps you save at high returns.
We hope you find this edition insightful, and as always, stay focused on your financial goals!