The National Bureau of Statistics has announced a significant decline in Nigeria's inflation rate, which dropped to 16.05 percent in October 2025. This represents the lowest inflation level the country has recorded since 2017, providing welcome relief to both consumers and policymakers.
Seven-Month Downward Trend Continues
The latest data from the NBS shows that headline inflation slowed from 18.02 percent in September to 16.05 percent in October, extending a seven-month downward trend. This consistent decline signals gradual improvement in Nigeria's macroeconomic environment after years of persistent price pressures that have burdened households and businesses alike.
Food inflation, which has been the primary driver of the cost-of-living crisis in Nigeria, also recorded a noticeable slowdown. Prices of essential staples including maize, garri, yam, rice, and vegetables increased at a more moderate pace compared to previous months, offering some respite to consumers who have struggled with soaring food costs.
Updated CPI Framework and Policy Measures
The National Bureau of Statistics explained that part of the decline can be attributed to the newly updated Consumer Price Index framework introduced this year. The rebased CPI uses 2023 as the new weight reference period and 2024 as the price reference year, significantly expanding the national consumption basket to include 934 product varieties across 13 divisions.
This statistical update ensures that inflation figures more accurately reflect current spending patterns nationwide, providing policymakers with better data for decision-making. The Central Bank of Nigeria had already responded to improving conditions in September by reducing the Monetary Policy Rate from 27.5 percent to 27 percent, marking its first rate cut in five years.
Challenges Remain Despite Positive Trend
Despite the encouraging inflation data, analysts caution that Nigerians continue to face significant economic challenges. Transport fares remain elevated due to ongoing fuel price instability, while insecurity in farming regions continues to disrupt food supply chains. Energy costs also persist as a major concern for both households and businesses, particularly in urban centers.
The government has intensified efforts to address structural constraints in the economy through various measures. These include increased support for dry-season farming, ongoing refinery repairs to stabilize fuel supply, and initiatives aimed at reducing foreign exchange volatility.
Economists emphasize that sustained disinflation will require consistent policy coordination between fiscal and monetary authorities, alongside improvements in energy supply, security, and infrastructure. The NBS expects continued moderation in inflation if current stability in key sectors is maintained, though the trajectory remains vulnerable to global shocks and domestic supply disruptions.
