Amanze Chinonye
Nigeria’s headline inflation rate dropped to 18.02 percent in September 2025, down from 20.12 percent recorded in August, according to the latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) on Wednesday.
The report marks the third consecutive month of decline in the headline inflation rate, reflecting a sustained moderation in prices following the adoption of the new 2024 base year for measuring inflation.
On a month-on-month basis, the headline inflation grew slightly by 0.72 percent in September, compared to 0.74 percent in August indicating a slower pace of price increases across goods and services. The Food Inflation Index also showed signs of relief, recording a -1.57 percent month-on-month change, suggesting a marginal drop in average food prices during the month under review.
Join our WhatsApp ChannelREAD ALSO: Price of Cooking Gas Rises By 44.62% In One Year – NBS
Reactions Trail Hacked NBS Website
Analysts while Speaking to Prime Business Africa attribute the slowdown to improved food supply in some parts of the country, easing logistics pressures, and the impact of government interventions in the agricultural sector.
NBS data showed that inflation had peaked above 30 percent between September and December 2024 under the old 2009 base year before declining sharply after the introduction of the new 2024 base year, which better reflects current consumption and price patterns.
Since the rebasing, the CPI has shown a consistent downward trend falling from 23.18 percent in February 2025 to 18.02 percent in September 2025. Economists say the latest figure could signal a gradual stabilization of prices in the short term, although sustained moderation will depend on exchange rate stability, food supply conditions, and fiscal policy consistency.
NBS reiterated that the CPI measures the average change over time in prices of goods and services consumed by people, serving as a key indicator of inflationary pressure in the economy.
Oye commends inflation decline, calls for coordinated policy action to sustain gains
Meanwhile, Chairman of the Alliance for Economic Research and Ethics Ltd., Dele Kelvin Oye, welcomed the latest report by the NBS showing that Nigeria’s headline inflation eased to 18.02 percent.
In a statement on Tuesday, Oye described the development as “encouraging”, noting that the moderation in inflation would help ease pressure on household budgets, restore some purchasing power, and provide a more favourable environment for investment and economic growth.
Oye said: “We welcome the NBS report showing that headline inflation eased to 18.02% in September 2025 — the sixth consecutive monthly decline. This moderation is encouraging: it eases pressure on household budgets, helps restore some purchasing power and provides a more favourable backdrop for investment and growth.”
He, however, cautioned that the inflation level remains high despite the improvement, noting, “Nonetheless, 18.02% remains unacceptably high, and persistent structural constraints — notably food supply bottlenecks, infrastructure gaps and security challenges — mean many households continue to face severe affordability pressures.”
Oye emphasised that sustainable progress requires coordinated fiscal and monetary strategies.
According to him, “To convert this momentum into durable price stability and inclusive growth, policymakers must pursue coordinated monetary and fiscal actions.”
He outlined key areas of focus, saying: “Priority steps include shifting from a predominantly revenue-focused regulatory stance to one that prioritises trade facilitation, making targeted public and private investments to boost food production and strengthen supply chains, improving public spending efficiency, and expanding well-targeted social safety nets for the most vulnerable.”
He added that consistency and transparency in policy communication will play a critical role in consolidating gains.
“These measures, combined with clear policy communication, will help anchor expectations and support a sustainable decline in inflation,” he explained.
Turning to the foreign exchange market, Oye expressed concern over the recent depreciation of the naira, noting: “At the same time, exchange rate developments warrant close attention: on Tuesday, 14 October 2025 the naira slipped 0.39% to close at ₦1,463.23 per dollar, the second consecutive day of losses after a brief reprieve driven by foreign inflows and CBN interventions.”
He attributed the pressure on the local currency to global market dynamics, noting: “Rising global demand for dollars — including a roughly 3% appreciation of the US dollar against a basket of currencies since mid-September — alongside higher global rates and geopolitical uncertainties, is increasing pressure on emerging-market currencies like the naira.”
Oye called for prudent management of foreign exchange and liquidity to preserve the recent gains and maintain investor confidence.
“Policymakers should therefore combine domestic reforms with prudent FX and liquidity management to preserve gains on inflation and maintain investor confidence,” he said.
Amanze Chinonye is a Staff Correspondent at Prime Business Africa, a rising star in the literary world, weaving captivating stories that transport readers to the vibrant landscapes of Nigeria and the rest of Africa. With a unique voice that blends with the newspaper's tradition and style, Chinonye's writing is a masterful exploration of the human condition, delving into themes of identity, culture, and social justice. Through her words, Chinonye paints vivid portraits of everyday African life, from the bustling markets of Nigeria's Lagos to the quiet villages of South Africa's countryside . With a keen eye for detail and a deep understanding of the complexities of Nigerian society, Chinonye's writing is both a testament to the country's rich cultural heritage and a powerful call to action for a brighter future. As a writer, Chinonye is a true storyteller, using her dexterity to educate, inspire, and uplift readers around the world.
