Nigeria’s inflation rate fell to 21.12 percent in August 2025, marking the fifth consecutive month of decline. Data from the National Bureau of Statistics show a 1.79‑percentage‑point drop from the 21.88 percent recorded in July 2025. On a year‑on‑year basis, inflation is down 12.03 percentage points compared with 32.15 percent in August 2024.
The slowdown is largely attributed to easing food inflation. Prices for imported rice, local rice, millet, semolina, flour, maize and other staples have fallen, bringing food inflation to 21.87 percent in August, a slight dip from 21.88 percent in July.
The moderation in inflation has prompted calls for the Central Bank of Nigeria to cut its policy rate, which currently stands at 27.50 percent. Economists argue that high interest rates are offsetting the benefits of lower inflation for Nigerians. Gbolade Idakolo, CEO of SD & D Capital Management, believes that a rate cut could relieve pressure on the real sector and reduce the cost of goods and services. He notes that the easing of inflation may lead the Central Bank to consider a reduction at its next Monetary Policy Committee (MPC) meeting, scheduled for 22‑23 September 2025.
Prof. Godwin Oyedokun of Lead City University in Ibadan cautions that the impact of lower inflation will be felt only if the changes filter through the economy and improve everyday life. While official figures show a decline, many Nigerians may still experience the lingering effects of previous high inflation and other systemic economic challenges.
The Central Bank’s decision on interest rates will be closely watched, as it is expected to have a significant impact on the country’s economy. A reduction could provide relief to the real sector, lower the cost of goods and services, and ultimately improve living standards. The upcoming MPC meeting will be pivotal in shaping Nigeria’s economic policy direction.
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