Share!
Nigeria’s headline inflation rate dropped for the sixth consecutive month in September, easing to 18.02 percent, its lowest level in three years, according to the latest data released by the National Bureau of Statistics (NBS) on Tuesday.
The report showed that core inflation slowed to 19.53 percent, while food inflation—which has been the major driver of rising prices—moderated to 16.87 percent during the period under review.
The steady decline in inflation represents a remarkable turnaround from the 34.19 percent peak recorded in June 2024, signalling that the Central Bank of Nigeria’s (CBN) aggressive monetary policy tightening is beginning to yield results.
In response to last year’s inflationary surge, the CBN had embarked on a sustained tightening cycle, raising the Monetary Policy Rate (MPR) from 18.75 percent to 27.50 percent, while increasing the Cash Reserve Ratio (CRR) to 50 percent for commercial banks and 16 percent for merchant banks.
At its Monetary Policy Committee (MPC) meeting in September 2025, the Bank slightly relaxed its stance, cutting the MPR by 50 basis points to 27.00 percent and reducing the CRR for commercial banks to 45 percent, while maintaining a firm commitment to curbing inflation and stabilizing prices.
The disinflation trend was further supported by reforms in the foreign exchange (FX) market, including the unification of exchange rates and enhanced transparency measures aimed at improving price discovery. The naira has since stabilized, with the gap between the official and Bureau de Change (BDC) market rates narrowing to below 2 percent.
Improved liquidity in the FX market has helped reduce imported inflation, while the country’s foreign reserves have risen above $43 billion, providing over eleven months of import cover—a buffer analysts say reflects growing investor confidence and sustained forex inflows.
In a statement, the CBN said it remains committed to consolidating the gains of disinflation through continued monetary discipline, exchange rate stability, and policies that enhance food supply and productivity across key sectors.
Speaking at the 2025 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group in Washington, the Governor of the CBN, Mr. Olayemi Cardoso, expressed optimism that the inflation rate will continue to moderate in the months ahead.
“We expect inflation to continue to trend downward in the near term, supported by tight monetary conditions, a stable naira, and improved food supply across the country,” Cardoso said.
No related posts.
