As Nigeria’s inflation continues to trend downward, many wonder if it will reach single digits, like those of its neighbour, Ghana. However, analysts predict a spike in December before cooling in 2026.
Nigeria’s inflation dropped for the eighth consecutive month to 14.45% in November, aligning with both the president’s projected figure of 15% at the end of 2025 and the budget target.
Since Nigeria rebased its Consumer Price Index (CPI) in early 2025, with the National Bureau of Statistics (NBS) shifting the base year to 2024 and updating consumption weights, it witnessed a significant statistical drop in the headline inflation rate from around 34.8% (Dec 2024) to 24.48% (Jan 2025)
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Since July, the rate of disinflation has accelerated sharply. The average monthly decline from July to November is approximately – 1.90% per month.
If the current momentum continues, Nigeria is likely to hit single-digit inflation by February 2026.
However, the full-year average shows a different trend taking into account the slower pace of decline earlier in the year, including the slight rise in March.
The average monthly decline from January to November is approximately −1.00% point.
Under this more conservative trajectory, the country will hit single-digit inflation by April 2026.
Ayo Teriba, CEO, Economic Associates, projects that Nigeria’s inflation could slow to a single digit by January 2026 as the lag effect of ‘Detty December’ is poised to further cool prices that have remained in the double-digit range for more than five years.
However, other analysts believe that there will be a spike in December inflation, which will reroute Nigeria’s move to a single-digit inflation due to the base effect, but explain that there’s no cause for alarm.
SBM projects that headline inflation will continue moderating, though it will stay above the government’s 15% target due to election spending and food inflation remaining a key pressure point.
Earlier this year, President Bola Tinubu had set an inflation target of 15^ for Nigeria by the end of December.
Wide-spread price declines across key staples, including maize, sorghum, paddy rice, and soybean, reinforce the easing trend. During the same period, the Naira appreciated by 1.45% month-on-month, averaging N1,443.85/dollar compared to N1,465.04 dollar in October.
This is why both food inflation declined to 11.08% from 13.12% in October, while core inflation eased to 18.04 percent (from 18.69% ).
Read also: Nigeria extends disinflation streak but December blip looms
CardinalStone projects that for the coming month, there will halt in disinflation temporarily.
“For context, the new base year of 2024 that was introduced has created a very low base, which we believe would temporarily translate to a marked increase in headline print to 32.07% in December 2025, before normalising from January 2026,” it said.
Cordros explains in its 2026 outlook that the low base from the CPI reset could mechanically lift the year-on-year reading, giving the appearance of a renewed uptick in price pressures, even though underlying price momentum is expected to remain subdued.
This means that the change in how the CPI is calculated has created a statistical illusion: the year-on-year inflation number will look worse than the underlying price situation actually as the new starting point for comparison is unnaturally low.
The report says that price pressures are expected to ease significantly in 2026, with the downward trend in headline inflation expected to resume after a brief uptick in December.
“Our baseline forecast places average headline inflation at 16.30% and a year-end rate of 14.70%,” analysts at Cordros say.
Bismark Rewane, CEO of Financial Derivatives Company, said inflation, which is now cooling across African markets, will remain in double digits in several economies, including Egypt, Sudan, Ethiopia, Nigeria, Angola, Malawi, and Zimbabwe.
“Inflation is expected to reverse upward in December as the base year gains fade,” the economist said in a presentation at the 18th Alpha Morgan economic review on Wednesday. “For Nigeria and Egypt, a shift by central banks towards more orthodox monetary policy frameworks will support disinflation in 2026.”
Charlie Robertson, frontier and emerging market economist, said that though Nigeria’s headline inflation rate will spike in December, it is moving towards a single digit.
Despite the slowing inflation this year, the Monetary Policy Committee (MPC) has cut rates only once by 50 basis points to 27%.
Arnold Dublin-Green, in the SBM publication, said that the market intuitively craves rate cuts as inflation cools.
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“It is worth noting that the currency’s recent stability has been built mainly on tight monetary conditions that keep foreign portfolio flows engaged and suppress the import demand that would otherwise put pressure on the FX market,” Dublin-Green said.
He said if CBN cut rates too aggressively, there will e erosion of the yield premium that attracts those inflows.
“Another reason the CBN held thera MPR and chose to adjust the asymmetric corridor is recognition that disinflation is underway but not yet durable. The path ahead is one of cautious, calibrated easing guided by naira stability rather than headline inflation. Another test will be whether the Bank can hold that line when political pressure inevitably builds to accelerate growth,” he said