Nigeria’s headline inflation rate dropped to 18.02 per cent in September 2025, marking the sixth consecutive month of decline and the first time in three years that the inflation figure has fallen below the 20 per cent mark.
The development, revealed in the latest Consumer Price Index (CPI) report published by the National Bureau of Statistics (NBS) on Wednesday, signals a sustained slowdown in price growth across major economic sectors.
According to the NBS, the September inflation rate represented a 2.1 per cent decrease compared to 20.12 per cent in August 2025, and a 14.68 per cent year-on-year drop from the 32.70 per cent recorded in September 2024.
This sustained moderation in inflation, analysts say, is largely due to the rebasing of the CPI and recent monetary policy adjustments by the Central Bank of Nigeria (CBN), which had earlier cut the Monetary Policy Rate (MPR) for the first time in years.
“On a month-on-month basis, the headline inflation rate in September 2025 was 0.72 per cent, 0.02 per cent lower than the rate recorded in August (0.74 per cent). This means that in September, the rate of increase in the average price level was slower than in August,” the NBS stated.
The report also showed that food inflation dropped significantly to 16.87 per cent on a year-on-year basis — 20.9 percentage points lower than the 37.77 per cent recorded in September 2024.
NBS attributed the decline partly to the change in the base year and a reduction in food prices, particularly for key commodities such as maize, garri, beans, millet, potatoes, onions, eggs, tomatoes, and pepper.
On a month-on-month basis, food inflation was recorded at -1.57 per cent, down by 3.22 per cent compared to August’s 1.65 per cent — a sign that average food prices fell rather than increased during the month.
Core inflation — which excludes volatile items such as food and energy fell to 19.53 per cent in September, representing a 7.9 per cent drop from 27.43 per cent in September 2024.
On a monthly basis, core inflation was 1.42 per cent, slightly lower than 1.43 per cent in August. The 12-month average inflation stood at 22.39 per cent, down from 25.64 per cent in the same period last year.
Urban inflation increased marginally by 0.25 per cent month-on-month to 0.74 per cent, but dropped sharply year-on-year to 17.50 per cent, about 17.63 percentage points lower than the 2024 figure.
Rural inflation declined both monthly and yearly, standing at 18.26 per cent on a yearly basis and 0.67 per cent on a monthly basis.
Across the 36 states, Adamawa (23.69%), Katsina (23.53%), and Nasarawa (22.29%) recorded the highest inflation rates, while Anambra (9.28%), Niger (11.79%), and Bauchi (12.36%) had the lowest.
On a month-on-month basis, Zamfara (9.36%), Adamawa (8.15%), and Nasarawa (7.49%) recorded the highest increases, while Niger (-8.14%), Oyo (-5.56%), and Bayelsa (-4.61%) experienced declines.
For food inflation, Ekiti (28.68%), Rivers (24.18%), and Nasarawa (22.74%) topped the list of states with the highest rates, while Bauchi (2.81%), Niger (8.38%), and Anambra (8.41%) had the slowest increases.
Economists and market analysts say the latest data strengthens expectations that the Monetary Policy Committee (MPC) may consider another rate cut in November to stimulate growth.
Lukman Otunuga, Senior Research Analyst at FXTM, had projected inflation to ease to 18.8 per cent, citing softer food prices and a stronger naira as the main drivers.
“Further signs of cooling price pressures may pave the way for additional rate cuts by the CBN in November to stimulate economic growth,” Otunuga noted.
Experts at Arthur Steven Asset Management also echoed the sentiment, saying the sixth straight month of disinflation shows the success of the September rate cut and builds momentum for another reduction.
Meanwhile, AIICO Capital in its Inflation Watch report said the inflation decline reflects the positive impact of policy reforms, including the CPI rebasing and the naira’s recent appreciation.
“The sharp decline in inflation, now approaching the 15 per cent budget benchmark, signals the possibility of further rate cuts before year-end,” the report stated. “However, sustaining long-term price stability will depend on policy discipline, food security, and stable energy prices.”
With inflation now trending below 20 per cent for the first time since 2022, economic analysts believe Nigeria may be entering a new phase of price stability, offering potential relief for households and encouraging a more predictable business environment.
