The National Bureau of Statistics in Nigeria has announced plans to release two separate inflation figures for December, following changes to its consumer price index methodology. According to a report by Bloomberg, the development is a result of the significant distortion caused by the rebasing of Nigeria’s consumer price index, which introduced methodological adjustments.
The country’s inflation data is closely monitored by the Central Bank of Nigeria as it transitions towards an inflation-targeting monetary policy framework. The Central Bank has already factored in the CPI rebasing and related computational issues in its three-year inflation forecast, targeting a slowdown in inflation to around 13% by next year.
The recent rebasing of Nigeria’s CPI, which introduced methodological adjustments, has significantly distorted the December inflation reading. Sources within the bureau indicate that the inflation data, scheduled for release on January 15, is projected to show an “artificially spiked” inflation rate of 31.2% for December, compared to 14.5% recorded in November.
To ensure transparency, the Statistician-General of the Federation, Prince Adeyemi Adeniran, has stated that the agency will publish both inflation figures. One figure will reflect economic fundamentals, while the other will capture the inflated outcome resulting from the rebasing methodology. Ayo Andrew, Head of Price Statistics at the NBS, disclosed that the agency may revise its monthly inflation figures to address the distortions caused by the methodological changes.
The NBS rebased Nigeria’s consumer price index for the first time in 16 years in 2024, shifting the reference year to 2024. The rebasing involved calculating the base using the average of all months in 2024, unlike previous exercises that used a single month as the base period. The agency also reweighted several categories and expanded the inflation basket to 934 items from 740.
Adeniran emphasized that the spike does not reflect Nigeria’s economic fundamentals but is driven by arithmetic and base effects. He noted that such base effects are not unusual in statistical computations and stressed that more frequent and timely rebasing would help prevent similar issues in the future. The release of the two separate inflation figures is expected to provide a clearer understanding of the country’s economic situation and help inform policy decisions.
