Central banks spent most of 2024 and early 2025 fighting the same battle. Inflation had surged across developed and emerging markets alike, forcing aggressive rate hikes and tight monetary policy almost everywhere. The assumption was that disinflation would follow similar paths once it started. That assumption is breaking down.
Some economies are seeing prices cool faster than expected while others are dealing with inflation that refuses to stay down even after falling for months. The divergence isn’t random. It reflects differences in currency stability, fiscal discipline, and how deeply services inflation has embedded itself in different economies. Understanding where price pressures are easing versus where they’re proving persistent matters for how central banks will respond in the months ahead.
Here’s a breakdown of what happened in the markets last week.
Global Economy
US: Labor Market Softening Continues
The US unemployment rate rose to 4.4% in February 2026, up from 4.3% in January and approaching November’s four-year high of 4.5%. The increase came slightly above market expectations. The number of unemployed increased by 203,000 to 7.57 million while employment declined by 185,000 to 162.91 million. These aren’t small movements. They represent meaningful deterioration in labor market conditions.
The labor force edged up by 18,000 to 170.48 million, though the participation rate slipped 0.1 percentage point to 62.0%. When participation is falling alongside rising unemployment, it suggests some workers are leaving the labor force entirely rather than continuing to search for jobs. That’s typically a sign of discouragement rather than voluntary retirement.
The U-6 unemployment rate, which includes discouraged workers and those employed part-time for economic reasons, fell to 7.9% from 8.1%. This broader measure provides additional context on labor market slacks. The divergence between rising headline unemployment and falling U-6 suggests the composition of unemployment is shifting rather than simply worsening across the board.
Eurozone: Services Inflation Proves Stubborn
Annual inflation in the eurozone rose to 1.9% in February 2026, up from 1.7% in January and above market expectations of 1.7% according to preliminary estimates. The increase was driven largely by stronger services inflation, which accelerated to 3.4% from 3.2%, alongside a pickup in non-energy industrial goods inflation to 0.7% from 0.4%.
Energy prices continued to decline but at a slower pace, falling 3.2% year-over-year compared with a 4.0% drop in January. Food, alcohol, and tobacco inflation remained unchanged at 2.6%. Core inflation, which excludes energy, food, alcohol and tobacco, rose to 2.4% from 2.2%, rebounding from January’s more than four-year low.
Across the bloc’s largest economies, inflation accelerated in France to 1.1% from 0.4%, in Spain to 2.5% from 2.4%, and in Italy to 1.6% from 1.0%. Germany’s inflation eased slightly to 2.0% from 2.1%. The broad-based acceleration across major economies suggests this isn’t a country-specific phenomenon but rather a regional trend that complicates the European Central Bank’s policy calculus.
Sub-Saharan African Economies
Angola: Non-Oil Growth Accelerates Sharply
Angola’s economy advanced 5.7% year-over-year in the fourth quarter of 2025, quickening from an upwardly revised 2.6% rise in the previous period. This expansion, driven mainly by non-oil activities, marks the strongest quarterly performance since the second quarter of 2023. The non-oil sector experienced a 7.34% expansion, representing 80.91% of GDP, while the oil sector contracted by 1.21%, accounting for 19.09% of the economy.
Notable growth was recorded in the information and communication sector, which surged 65.7%, alongside accommodation and food services activities growing 18% and manufacturing expanding 16.5%. These aren’t marginal improvements. They represent structural shifts in how the Angolan economy generates growth.
By contrast, oil extraction and refining declined 1.2% compared to a 6.9% contraction the previous quarter, while diamond and metallic mineral extraction fell 7% after growing 2.1% previously. For the full year 2025, Angola’s economic growth reached 3.1%, down from a revised 4.95% in 2024. The economy is diversifying away from oil dependency, which creates both opportunities and challenges as traditional revenue sources contract while new sectors expand.
Ghana: Inflation Hits 27-Year Low
Ghana’s annual inflation rate fell to 3.3% in February 2026 from 3.8% in January, marking the 14th consecutive month of slowing price growth. This was the lowest reading since August 1999, a remarkable achievement amid ongoing strength of the cedi. The food inflation rate fell to 2.4% from 3.9% in January, while non-food price growth accelerated slightly to 4.0% from 3.9%.
On a monthly basis, the consumer price index rose by 0.8% after a 0.2% increase in the previous month. The reacceleration in monthly inflation warrants monitoring, but the annual trend remains firmly disinflationary. Currency stability has been the primary driver of this inflation success, demonstrating how exchange rate management can cascade through an economy’s entire price structure when executed consistently.
Domestic Economy
Major Updates During the Week
1. Pension Assets Surge to ₦28 trillion
Nigeria’s pension fund assets rose 22.64% year-over-year to ₦28.04 trillion in January 2026, up from ₦22.86 trillion in January 2025. This represents an addition of over ₦5 trillion in pension assets in a single year, driven by continued contributions, investment returns, and the recent regulatory changes that increased equity allocation limits for pension funds.
The growth in pension assets matters for several reasons beyond retirement security. These funds represent one of the largest pools of long-term capital in Nigeria’s financial system. When pension fund managers increase their equity allocations, as they’ve been doing following the regulatory changes in February, it provides sustained buying power that can support market stability and valuations. The ₦28 trillion figure also underscores the scale of institutional capital that pension funds can deploy across different asset classes.
2. CBN Adds Gold to Reserves
The Central Bank of Nigeria added LBMA-standard gold to Nigeria’s reserves, bringing total gold holdings to $3.50 billion. This represents a strategic shift in reserve composition, diversifying away from holding exclusively foreign currency reserves. Gold serves as a hedge against currency volatility and provides stability during periods of global financial market stress.
The decision to hold LBMA-standard gold specifically is significant because it ensures the gold meets internationally recognized quality standards, making it highly liquid and acceptable for international transactions. For a country that has historically struggled with reserve adequacy, building gold holdings provides an additional buffer against external shocks.
3. Private Sector Returns to Expansion
Nigeria’s Stanbic IBTC PMI rose to 53.2 in February from 49.7 in January, signaling renewed private sector expansion driven by stronger output, new orders, and continued job creation. The return to expansion territory above 50 is particularly significant given that January’s reading indicated contraction. The improvement supports expectations of over 4% GDP growth in the first quarter of 2026, suggesting the economy is maintaining momentum following the 4.07% growth recorded in Q4 2025.
Equity Market: Oil Stocks Drive Recovery
The Nigerian equity market closed the first trading week of March on a positive note, gaining 2.15% week-over-week to 196,992.44 points, reversing the previous week’s losses. The rally was largely supported by strong gains in ARADEL, which surged 19.96%, OANDO up 18.76%, UACN rising 20.62%, CUSTODIAN gaining 20.44%, and STANBIC adding 9.02%. Losses in INTBREW, ETI, ZENITHBANK, and UBA limited further upside.
Year-to-date returns improved to 26.59%, maintaining the strong start to 2026 despite the previous week’s pullback. Market breadth strengthened slightly to 0.49 times with 37 gainers versus 76 losers, though decliners still dominated. This suggests that the rally was concentrated in specific names rather than broadly distributed across the market.
2. GDP Data Shows Broad-Based Expansion
The National Bureau of Statistics reported that Nigeria’s economy grew 4.07% year-over-year in Q4 2025, compared to 3.76% year-over-year in Q4 2024. The acceleration was driven by both oil and non-oil sectors, with particularly strong performances in information and communication, finance and insurance, and construction.
3. Revenue Targets Raise Tax Concerns
Nigeria’s National Revenue Service is targeting ₦40.7 trillion in revenue for 2026, banking on stronger non-oil collections and new oil royalty flows. The ambitious target reflects government confidence in economic growth and improved tax administration. However, if collections underperform expectations, the pressure to introduce additional taxes or raise existing rates will intensify. New taxes could pose upside inflation risks, particularly if they target consumer goods or energy products that feed directly into the consumer price index.
Equity Market: Profit-Taking Ends the Bull Run
Bears returned to the Nigerian equities market this week, ending a three-week winning streak as investors locked in gains across heavyweight counters. The NGX All-Share Index declined 1.11% for the week to close at 192,826.78 points. Market capitalization fell 1.12% to ₦123.76 trillion. After climbing over 25% year-to-date in just six weeks, some profit-taking was inevitable and healthy.
Losses were pronounced in consumer goods, industrial goods, insurance, and oil and gas sectors following a regulatory warning against speculative trading. During the week, trading in ZICHIS was suspended effective February 23rd, pending the outcome of an exchange review into recent activity. When regulators step in like this, it tends to cool speculative enthusiasm across the broader market.
Trading activity weakened, with volume falling 30.84% week-over-week to 3.50 billion units and value declining 5.83% to ₦177.74 billion. Sectoral performance was mixed but positive overall, as gains in oil and gas, industrial, and banking sectors offset weakness in insurance and consumer goods stocks. The concentration of gains in oil and gas names reflects investor positioning for continued improvement in production and favorable global oil prices.
Fixed Income Market: Investors Demand Higher Compensation
The Debt Management Office recorded strong demand at the March 4th Treasury Bills auction, particularly for the 364-day paper, which drew ₦2.13 trillion in subscriptions against a ₦1.05 trillion offer. The DMO eventually allotted ₦1.01 trillion across the 91-day, 182-day, and 364-day tenors, with stop rates settling at 15.95%, 16.65%, and 16.73%, respectively.
Strong bids at higher rates pushed the secondary market average yield up 11 basis points to 17.38%, indicating a bearish tone. When investors are demanding higher yields despite strong auction demand, it signals concerns about inflation risk or expectations that rates will need to move higher to attract capital. The willingness to accept lower allocations at higher yields rather than chase lower yields suggests investors believe current rate levels don’t adequately compensate for perceived risks.
A similar trend was observed in the bond market, where average yields rose 21 basis points week-over-week amid weaker demand for long-tenor bonds. In the Eurobond market, Nigeria’s sovereign papers also traded lower, with yields rising 19 basis points week-over-week to 7.17% as ongoing geopolitical tensions drove risk-off sentiment among global investors.
The synchronized increase in yields across Treasury Bills, government bonds, and Eurobonds suggests a broad reassessment of risk rather than technical factors in any single market segment. Analysts expect continued bearish sentiment in the coming week as investors demand higher yields amid inflation concerns.
The Bottom Line
Disinflation isn’t following a universal script. Economies with different starting conditions, policy frameworks, and structural characteristics are experiencing price normalization at vastly different speeds and with different degrees of persistence. What works in one context doesn’t necessarily translate to another, and the assumption that all central banks face similar challenges is proving increasingly outdated.
The real test comes in how policymakers respond to these divergences. Maintaining discipline when inflation is falling requires different judgment than tightening when prices are accelerating. Diversifying reserves and building institutional capital pools are long-term investments that don’t show immediate returns but create capacity for sustained growth. Markets will continue repricing assets based on where they see the most compelling combinations of stability, growth potential, and adequate compensation for risk. Those calculations keep shifting as conditions evolve.
