Nigeria’s headline inflation charge dropped to 24.48% year-on-year in January 2025, following the rebasing of the Client Worth Index (CPI), in keeping with knowledge launched by the Nationwide Bureau of Statistics (NBS).
The report highlights a decline within the basic worth degree of products and providers in comparison with 34.80% in December 2024, which was calculated utilizing the earlier methodology.
The Statistician-Basic of the Federation, Adeyemi Adeniran, disclosed this on Tuesday throughout a press briefing in Abuja, noting that the rebased inflation figures present a extra correct illustration of client spending patterns and {economic} realities within the nation.
In response to the most recent NBS report, city inflation stood at 26.09%, whereas rural inflation was recorded at 22.15%. The report highlights a decline within the basic worth degree of products and providers in comparison with 34.80% in December 2024, which was calculated utilizing the earlier methodology.
Adeniran defined that the rebased Client Worth Index (CPI) concerned updating the reference 12 months and modifying the basket of products and providers utilized in inflation measurement.
This adjustment ensures that inflation figures higher replicate present {economic} circumstances and client spending habits.
Meals and Core Inflation
The rebased meals inflation index stood at 26.08% year-on-year in January 2025, indicating a decline from the 39.84% recorded in December 2024 below the previous methodology.
- The meals inflation index measures the worth motion of important meals objects, which represent a good portion of family expenditures in Nigeria.
- Equally, the core inflation charge, which excludes unstable agricultural produce and power costs, stood at 22.59% year-on-year in January.
- The decline in core inflation suggests easing inflationary pressures in non-food sectors of the financial system.
Implications of CPI Rebasing
The NBS famous that the rebasing of the CPI is a important step in guaranteeing that inflation knowledge stays related and reflective of {economic} realities.
The earlier base 12 months didn’t adequately seize the modifications in client habits, rising market traits, and shifts in spending patterns over time.
Economists argue that whereas the decrease inflation figures provide some reduction, the price of residing stays excessive, and the impression of inflation continues to be felt throughout numerous sectors.
The effectiveness of presidency insurance policies, together with financial tightening by the Central {Bank} of Nigeria (CBN) and monetary interventions geared toward stabilizing costs, shall be essential in figuring out future inflation traits.
What you must know
- The drop in inflation may sign improved {economic} stability, however it doesn’t essentially translate into decrease costs within the speedy time period.
- As an alternative, the slower tempo of inflation signifies that costs are rising at a decreased charge, providing some reduction to households and companies battling excessive prices.
- The enterprise neighborhood shall be carefully watching how the federal government navigates inflation management measures whereas guaranteeing sustained {economic} development.
- The CBN’s financial insurance policies, alternate charge stability, and monetary methods will play a key function in shaping inflationary traits within the coming months.
