Nigeria’s Inflation Drops Again: Analysts Predict Biggest Relief Yet by December 2025
Detailed Breakdown of the Inflation News
1. Inflation in Nigeria is falling steadily
Nigeria’s inflation has been dropping for six months in a row, showing that prices are not rising as fast as before.
• September 2025 inflation: 18.02%
This is lower than 20.12% in August.
• This drop was better than expected because Cowry Research earlier predicted 19.73%.
Month-on-month improvement
• Prices rose by 0.72% between August and September.
This is slightly lower than the 0.74% recorded the previous month, meaning price increases slowed down.
Year-on-year improvement
• Inflation in September 2025 is 14.68 percentage points lower than the 32.70% of September 2024.
• This is the lowest inflation level since May 2022.
2. Analysts expect further inflation reduction
Several financial and economic bodies are predicting that inflation will continue to fall.
⭐ Cowry Research
• Says the consistent drop in inflation + the interest rate cut by the Central Bank in September =
Possible another interest rate cut in the next MPC meeting.
⭐ United Capital Projection
• Predicts inflation will fall further to 16.30% in October 2025.
• Reasons:
• Food prices are falling.
• The naira is stronger.
• However, rising energy prices may still push costs up slightly.
⭐ Access Bank’s Economic Intelligence Unit
• In its Q3 report, it projects inflation will fall to 16.84% in October 2025.
• Reasons:
• Stable exchange rate.
• Harvest season has improved food supply.
3. IMPI (Independent Media and Policy Initiative) View
IMPI believes inflation will fall even more sharply:
• New projection: 14% by December 2025
• Previous projection: 17%
They say falling inflation over the past six months is already helping to reduce poverty numbers.
Why inflation affects poverty
• When prices rise sharply, more people become poor because their money buys less.
• Nigeria’s inflation peaked at 34.8% in December 2024, which contributed to the World Bank’s estimate that 139 million Nigerians were living in poverty.
• Now that inflation is falling, IMPI believes:
• Some Nigerians have moved out of poverty.
• The economy is improving.
• The government is trying to maintain a low-cost environment despite labour disputes.
4. Expected Action from the Central Bank
• IMPI expects the Central Bank to reduce interest rates by at least 150 basis points during the next MPC meeting.
• Lower interest rates usually help:
• Businesses take loans more easily,
• Investments grow,
• The economy expand.
Summary: What this all means
• Inflation is reducing consistently—good news for the economy.
• Food prices and a strong naira are helping to bring prices down.
• Analysts expect inflation to fall to between 14% and 17% by end of 2025.
• A reduction in interest rates is likely soon.
• Falling inflation might gradually lift more Nigerians out of poverty.
Detailed Breakdown of the Inflation News
1. Inflation in Nigeria is falling steadily
Nigeria’s inflation has been dropping for six months in a row, showing that prices are not rising as fast as before.
• September 2025 inflation: 18.02%
This is lower than 20.12% in August.
• This drop was better than expected because Cowry Research earlier predicted 19.73%.
Month-on-month improvement
• Prices rose by 0.72% between August and September.
This is slightly lower than the 0.74% recorded the previous month, meaning price increases slowed down.
Year-on-year improvement
• Inflation in September 2025 is 14.68 percentage points lower than the 32.70% of September 2024.
• This is the lowest inflation level since May 2022.
2. Analysts expect further inflation reduction
Several financial and economic bodies are predicting that inflation will continue to fall.
⭐ Cowry Research
• Says the consistent drop in inflation + the interest rate cut by the Central Bank in September =
Possible another interest rate cut in the next MPC meeting.
⭐ United Capital Projection
• Predicts inflation will fall further to 16.30% in October 2025.
• Reasons:
• Food prices are falling.
• The naira is stronger.
• However, rising energy prices may still push costs up slightly.
⭐ Access Bank’s Economic Intelligence Unit
• In its Q3 report, it projects inflation will fall to 16.84% in October 2025.
• Reasons:
• Stable exchange rate.
• Harvest season has improved food supply.
3. IMPI (Independent Media and Policy Initiative) View
IMPI believes inflation will fall even more sharply:
• New projection: 14% by December 2025
• Previous projection: 17%
They say falling inflation over the past six months is already helping to reduce poverty numbers.
Why inflation affects poverty
• When prices rise sharply, more people become poor because their money buys less.
• Nigeria’s inflation peaked at 34.8% in December 2024, which contributed to the World Bank’s estimate that 139 million Nigerians were living in poverty.
• Now that inflation is falling, IMPI believes:
• Some Nigerians have moved out of poverty.
• The economy is improving.
• The government is trying to maintain a low-cost environment despite labour disputes.
4. Expected Action from the Central Bank
• IMPI expects the Central Bank to reduce interest rates by at least 150 basis points during the next MPC meeting.
• Lower interest rates usually help:
• Businesses take loans more easily,
• Investments grow,
• The economy expand.
Summary: What this all means
• Inflation is reducing consistently—good news for the economy.
• Food prices and a strong naira are helping to bring prices down.
• Analysts expect inflation to fall to between 14% and 17% by end of 2025.
• A reduction in interest rates is likely soon.
• Falling inflation might gradually lift more Nigerians out of poverty.