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The Independent Media and Policy Initiative (IPI) is projecting that the inflation of the Nigeria title will go further 17 % by December 2025 after a consecutive drop that brought the figure to 20.12 percent in August.
The Think Tank also provides that the Central Bank of the Nigeria Monetary Policy Committee (MPC) will reduce the monetary policy rate (MPR) to the next meeting in response to five consecutive drop in month on month.
In its last political declaration, signed by its president, dr. Omoniyi Akinsiju, IMI explained that the country is experiencing a long period of disinflation.
He said: “We observed how some critics have rejected the decline of the inflation rate as a consequence of the people, insisting in a contemptuous way that the prices have not changed in any way to influence the mass of the Nigerian people.
“We consider this expression of the intention not to recognize the positive steps of the Federal Administration. Empirically speaking, the Nigerian economy is now in a disinference dispensation. Disinflation is a temporary slowdown in the rhythm of prices and is used to describe the cases in which the inflation rate has reduced short -term marginal.
“Nigeria recorded rare disinflation in 2025, with the inflation that drops from 24.5 percent in January to 20.12 percent in August, about a drop of 17.5 percent, the more acute half-year slowdown in over a decade. A 10-year analysis of data shows that, unlike 2020-2024, when inflation has accelerated, 2025 alongside 2017.
“Consequently, the history of Nigeria’s inflation in 2025 is taking an unusual turning point because, for the first time in almost a decade, the country is witnessing a significant and supported slowdown of consumer prices. In relative terms, this is a 17.5 percent reduction compared to the January level, a disinflation rhythm rarely seen in the modern economic history of Nigeria.
“So far, we have witnessed the way the inflation rate, instead of climbing, has constantly decreased month after month (with the exception of a short increase in March), which end below 21 %, the first time in 16 months that the main inflation had decreased so low.”
IPI has also identified the factors that its analysts insist are responsible for the decline in the inflation of securities in recent months.
“Three key factors are modeling the deceleration of Nigeria’s inflation in 2025: CBN maintained rates at 27.50 percent, slowing down credit requests and speculative forex activities; the stable exchange rate due to the increase in the influx of changes in the country through oil, the remittances and gains of non -allcine exports;
“At 20.12 percent of August, the apparent indication is that the inflation rate year on year fell below the 21 % lens set by the CBN. However, with the momentum generated in the economy, we can also safely mediate the average of inflation.
“We can project that the Central Bank’s monetary policies Committee (MPC) will take into consideration the possibility of facilitating the current monetary policy rate of 27.50 percent (MPR) of at least 50 basis points in the next meeting and at least 200 base points by December 2025.
In the same way, we also project a review of the cash reserve ratio (CRR) from 50 % for bank deposits to 35 % by December 2025. This revision will have an impact on the cost of production, improves the expansion of companies and will create jobs due to the cheaper cost of credit and here
IPI also recognized that the rebound in the fortunes of some of the largest companies in Nigeria after having undergone losses in the aftermath of the federal government’s decision to float the Naira.
“Like the removal of the fuel subsidy, in June 2023, Nigeria float the Naira, marking a historic turning point in its exchange regime. Shortly after, Naira experienced a steep depreciation, descending from about N460/$ in June 2023 to N1.535/$ of End 2024.
“This strong amortization has exposed the Nigerian companies to enormous FX translation losses and increased charges of interest, which has eroded the value of shareholders through the Nigerian exchange.
“The pain was widespread but particularly pronounced in the sectors of consumer goods and ICT, in which companies were highly based on imported raw materials or transported substantial loans to foreign denominations. From Q1 2024, seven important consumer companies listed- Bua Negatia, no composed to composed N418 billion.
“Over the two years, these companies have collectively lost N867 billion, dragged by exposure to foreign currency and the expenses of interest in hot air balloon. However, in the last quarter of 2024, the stability signs have started to return to the economy.
“The change market has become more orderly, with the Naira establishing itself in a relatively stable band. FX volatility has been loosened and the liquidity of the market has gradually improved.
“At the same time, companies have adapted their cost structures, refined price strategies and the renovation of foreign obligations, creating a base for recovery. By the end of the first quarter of 2025, that foundation began to produce results. After almost two years of losses, the consumer goods sector recorded a strong turning point in the 2025 award.
“The seven companies that had recorded a combined loss of N418 billion in the first quarter of 2024 returned to a gross profit of the combined taxes of N289.8 billion in the first quarter of 2025. By the end of the second quarter 2025, all consumer goods companies had returned to profitability with a pre-tasso profit of about N264.
“These strong reversals of the profits highlight how currency stability and internal costs controls can quickly move the fortunes of the companies previously dragged by the macroeconomic wind. This captures the context in which national and global commentators have returned a stability verdict for the Nigerian economy,” said IPI.
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