Nigeria reports a February inflation rate of 23.18%, down from 24.48%, driven by lower fuel prices and a stable naira. Analysts predict potential future increases in inflation, attributing challenges to global economic factors. The MPC holds interest rates at 27.50%.
Nigeria’s inflation rate decreased for the first time in 2025, attributed to stable naira performance and lower petrol prices following a Consumer Price Index (CPI) rebase. The National Bureau of Statistics reported a February inflation rate of 23.18%, down from 24.48% in January 2025. This decline was driven by reduced diesel and petrol costs, significantly impacting overall economic health, benefiting consumers and businesses alike.
Diesel prices fell by 33% to ₦1,000 per liter, while petrol prices remained stable at over ₦800 per liter. Additionally, food inflation also saw a slight decline, with February’s rate at 23.51%, compared to 24.08% in January. These changes showcase a positive trend in the market, attributed to increased output from the Dangote Refinery.
Analysts note that Nigeria may be at a turning point regarding inflation trends after the CPI rebasing. Predictions indicate a potential acceleration in inflation starting in April, compounded by global economic challenges. Some experts forecast an average annual inflation rate of 31%, despite the rebasing efforts.
Basil Abia, co-founder of Veriv Africa, remarked on the challenges facing Nigeria: “My outlook for 2025 in Nigeria in spite of the rebasing is an average rate of 31% for the year. So, expect worse monthly numbers deep into 2025.”
The Monetary Policy Committee (MPC) decided to maintain interest rates at 27.50% in February, reflecting evaluations of current macroeconomic conditions, including stable exchange rates and a leveling off of fuel price increases in the aftermath of the CPI adjustment.
In summary, Nigeria’s inflation rate has shown a noteworthy decline for February 2025, influenced by stable naira and reduced fuel prices. However, analysts remain cautious about future inflation acceleration due to global economic factors, expecting the Central Bank of Nigeria to face challenges in meeting inflation targets amidst these developments. The consistent interest rate is indicative of ongoing economic monitoring.
Original Source: techcabal.com
