October 16, 2025/InvestmentOne Report

In September 2025, Nigeria s headline inflation rate eased further to 18.02% YoY, down 210bps from 20.12% in August, marking the sixth consecutive month of decline and represented a historic milestone as the rate fell below the 20% threshold for the first time since May 2022. The moderation highlights the sustained slowdown in the pace of price increases, reflecting improved supply conditions, relative exchange rate stability, and sustained tight monetary conditions.

Compared with September 2024, when inflation stood at a steep 32.70%, the current reading reflects a sharp drop, partly influenced by the change in the base year to 2024. On a monthly basis, the Consumer Price Index (CPI) rose marginally by a modest 0.72%, slightly below the 0.74% recorded in the previous month.

Looking ahead, inflation is expected to continue its downward trend into the final quarter of 2025, albeit at a slower pace. The combination of improved agricultural output, sustained currency stability, and measured monetary easing should maintain price stability in the near term. The recent rate cut suggests the CBN may now moderate its stance future cuts of 50 to 100bps over coming meetings are plausible, provided inflation, FX, and fiscal variables remain supportive.  

However, several risks could disrupt the benign inflation trajectory. The festive season approaching in the fourth quarter typically brings increased demand for food, clothing, and transportation, which could temporarily reverse some of the gains made in inflation deceleration.

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