By Yinka Kolawole & Elizabeth Adegbesan   

The Center for Private Public Enterprise, CPPE and other analysts have urged caution over the decline in the inflation rate to 24.48 per cent in January announced by the Nigeria Bureau of Statistics, NBS.

According to the NBS, headline inflation rate fell by 10.32 percentage points to 24.48 percent in January 2025, from 34.8 percent in December 2024 after rebasing the Consumer Price Index (CPI).

The Bureau in a statement on the   Consumer Price Index, CPI report for January, said the rate January 2024.”

NBS also said that the food inflation rate fell to 26.08 percent in January 2025 from 39.84 percent in December 2024.

“The rebased Food Index in January 2025 was 110.33, while the food inflation rate on a year-on-year basis stood at 26.08 percent in January 2025. “This means that the general prices of food items in Nigeria increased by 26.08 percent compared to January 2024.”

Commenting, Director General, CPPE, Dr. Muda Yusuf, said  the drastic deceleration in inflation should therefore be cautiously celebrated, stressing that, “The reality of high prices has not changed and remains a major factor in the cost of doing business, cost of living and poverty equation in the country.  

Households and firms are still concerned about high energy costs, the strength of the naira, high interest rate, cost of imports, transportation costs and insecurity.   It is hoped that the government will recalibrate its strategies to address these major cost drivers.  

Also commenting, analysts at FBNQuest Securities Limited, said, “The sharp drop in headline inflation presents a dilemma for monetary authorities, as it shifts real interest rates from negative to positive. Given this development, we expect the MPC to pause its tightening cycle at its next meeting on February 19-20, 2025, to assess the future trajectory of inflation before making further policy adjustments. 

Rebased inflation rate doesn’t reflect actual drop in prices – LCCI

The Lagos Chamber of Commerce and Industry (LCCI) has said that the drop in inflation rate for January as reported by the National Bureau of Statistics (NBS) is only a reflection of different measurement and not an actual drop in prices.

In a statement yesterday, Director General of LCCI, Dr Chinyere Almona, stated: “The drop in inflation from 34.8% to 24.48% does not indicate a sharp fall in prices but a revised way of calculating inflation. Despite the lower reported rate, inflation remains high, meaning prices are still rising, just at a slower pace.

“A lower inflation rate may seem positive, but it does not automatically improve living standards. Prices are still rising, wages remain stagnant, and unemployment is high, keeping real incomes under pressure. 

“The rebased inflation rate only reflects a different measurement, not an actual drop in prices. For most Nigerians, essential costs like food and transportation remain high, meaning living conditions will not improve unless there is a real reduction in the cost of necessities.”

She noted that while the rebased inflation rate provides policymakers with a clearer view of economic trends, it does not resolve the rising cost of living. 

“The government must implement targeted interventions to address inflationary pressures and improve economic stability.

“One key priority is tackling food inflation, which accounts for over 50% of price increases. Policies should focus on boosting agricultural productivity, reducing post-harvest losses, and improving transportation and storage infrastructure to ensure food affordability,” Almona added.