Nigeria’s December 2025 inflation figures have been projected to experience an artificial spike due to a technical base effect.
The ‘artificial spike,’ the National Bureau of Statistics (NBS) explained, does not reflect the country’s inflation dynamics but rather a statistical rebasing, which it said is ‘one-off.’
“Projections show that without adjustment, December year-on-year inflation could appear excessively high due solely to arithmetic base effects, rather than underlying economic conditions,” Ayo Anthony, head of price statistics at the NBS, said during a stakeholder engagement organised by the Nigerian Economic Summit Group on Monday, ahead of the official release of the data on Thursday.
“The spike is not a reflection of our economic fundamentals. We’re releasing the spiked figures and the official headline inflation that policymakers will use. There’d also be a reversal in January to December 2025 inflation numbers in due course.”
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The NBS said that after what it described as the ‘price reference period,’ which occurred between January and December 2024, had been observed, a ‘re-referencing’ of the CPI is needed for ‘normalisation’, following the rebasing, a condition that is expected to lead to an ‘artificial spike’ in the December figures.
BusinessDay had previously reported that the December inflation reading would edge up to over 30 percent due to the low base effect, even as general prices continue their downward trend, helped by slowing food and energy prices.
Nigeria’s headline inflation slowed for most of 2025, with only an uptick observed in March. Prices cooled to 14.45 percent in November, down from 16.1 percent in October. The disinflationary trend, analysts cautioned, was more of a statistical effect rather than a complete elimination of price pressures.
The continued disinflation trend helped actualise the government’s 2025 inflation budget assumption of 15 percent, marking the first alignment in six years.
Nigeria rebased its CPI earlier last year for the first time in 15 years, shifting the base year to 2024 and updating consumption weights. The methodological change resulted in a sharp statistical drop in headline inflation from about 34.8 percent in December 2024 to 24.48 percent in January 2025.
Expected spike ‘artificial,’ no cause for alarm
Though the CPI is set to rise due to the statistical rebasing that was done in December 2024, the surge is rather ‘artificial’ and does not mean renewed inflationary pressures.
Nigeria’s inflation outlook, as in most projections, is expected to continue moderating, aided by easing pressure points, including slowing food prices, a firmer naira that closed 2025 with a 7.5 percent gain, and declining pump prices.
“There is scope for a reversal in the headline print in December,” analysts at CardinalStone said in a note. “The introduction of the 2024 base year has created an unusually low comparison point, which could mechanically lift the headline reading to about 32.07 percent in December 2025, before normalising from January 2026.”