Independent Media and Policy Initiative (IMPI), a prominent Nigerian policy think-tank, predicts that Nigeria’s headline inflation will decrease to 17% by December 2025, according to a statement released on Wednesday.
Chairman of the Initiative, Dr. Omoniyi Akinsiju highlighted that this forecast follows a consistent decline, with inflation dropping to 20.12% in August from 24.5% in January.
“This marks the most significant mid-year slowdown in over a decade,” Akinsiju noted, describing the trend as Nigeria’s longest period of disinflation in nearly ten years.
Akinsiju attributed the decline to three main factors: the Central Bank of Nigeria (CBN)’s stringent monetary policy maintaining a 27.5% policy rate, improved stability in the foreign exchange market driven by oil revenues, remittances, and non-oil exports, and enhanced agricultural output from key food-producing regions.
“For the first time in nearly a decade, Nigeria is experiencing a sustained and meaningful reduction in consumer prices,” he stated, comparing the 2025 trend to rare disinflation periods in 2017 and 2018.
Looking ahead, Akinsiju anticipates that the CBN’s Monetary Policy Committee (MPC) will respond by lowering the policy rate by at least 50 basis points at its upcoming meeting, potentially reducing it by up to 200 basis points by December.
He also foresees a reduction in the cash reserve ratio (CRR) from 50% to 35%, which he believes will “lower production costs and bolster businesses.”
“With the economy gaining momentum, we are confident that inflation could reach 17% by December 2025, aligning closely with the federal government’s 15% target,” Akinsiju concluded.
