Nigeria recorded a substantial reduction in headline inflation in October 2025, even as monthly price momentum increased.
The national Consumer Price Index, which measures the inflation rate in an economy, rose to 128.9 in October, up from 127.7 in September.
Key Indicators
| Inflation Measure | September 2025 | October 2025 | Direction | What It Means |
|---|---|---|---|---|
| Headline YoY | 18.02% | 16.05% | ⬇ Improvement | Price pressures easing compared to 2024 |
| Headline MoM | 0.72% | 0.93% | ⬆ Rising monthly strain | Prices are still increasing faster |
| Annual Average | 32.26% | 22.02% | ⬇ Deep decline | Previous shock period falling out of base |
| CPI Index | 127.7 | 128.9 | ⬆ | Higher cost of living continues |
Bottom line: Inflation is slowing relative to last year, but Nigerians are still paying more every month.
What Is Driving Inflation?
Year-on-Year Contributions to Headline Rate
(Impact on the total 16.05%)
| Division | Contribution |
|---|---|
| Food & Non-Alcoholic Beverages | 6.42% |
| Restaurants & Accommodation | 2.07% |
| Transport | 1.71% |
| Housing, Utilities & Energy | 1.35% |
| Education | 1.00% |
| Health | 0.97% |
➡ Food remains the number-one pressure point, accounting for 40%+ of total inflation.
Month-on-Month Price Drivers
(Impact on the +0.93% MoM rise)
| Division | Contribution |
|---|---|
| Food | 0.37% |
| Restaurants & Accommodation | 0.12% |
| Transport | 0.10% |
| Energy & Utilities | 0.08% |
| Education & Health | 0.06 each |
➡ Urban-service inflation (restaurants, schooling, health) is ramping up.
Food Inflation: The Real Story for Households
| Period | Rate | Trend |
|---|---|---|
| YoY | 13.12% | ⬇ Drastic drop from 39.16% last year |
| MoM | -0.37% | ⬆ From -1.57% in September |
Although annual food inflation has improved due to strong base effects, monthly food prices are rising again, mainly due to:
-
Vegetables (ugu, okazi)
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Onions
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Fruits (orange, pineapple)
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Groundnuts
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Shrimp and livestock meats
Households remain highly vulnerable as volatile essentials move upward again.
Urban vs Rural Inflation
| Category | YoY | MoM | Insight |
|---|---|---|---|
| Urban | 15.65% | 1.14% | Transport & housing driving steep monthly increases |
| Rural | 15.86% | 0.45% | Local supply dampens price build-up |
➡ Cities are suffering faster cost increases, especially in services and logistics.
Policy Interpretation
The report sends mixed signals for policymakers:
| Positive | Negative |
|---|---|
| Strong YoY disinflation shows reforms are working | MoM acceleration shows pressures are not yet under control |
| Annual average inflation sharply lower | Food supply disruptions still persistent |
| FX stability improving | Energy & transport remain cost-push risk factors |
The Central Bank is likely to:
-
Maintain tight monetary stance
-
Delay discussions of rate easing
-
Demand more structural intervention from fiscal authorities
Key Risks Ahead
-
Fuel/logistics costs rising into dry season
-
FX instability returning if inflows weaken
-
Food supply chains exposed to insecurity
-
Tuition and school-cost adjustments next quarter
Any one of these can reverse recent YoY gains.
Nigeria is experiencing statistical relief — not economic relief. Prices are still rising each month, even as annual inflation looks better on paper.
Real improvement will only be felt when monthly inflation consistently falls toward zero and food prices stabilise for households.