Dear Subscriber,

The National Bureau of Statistics (NBS) will release its December 2023 inflation report on January 15. Based on our analysis, which is a combination of our market survey and a time series model, Nigeria’s headline inflation is projected to climb by 0.5% to 28.7%. Our projection will probably be accurate within a margin of error ranging from -0.5 % to +0.5%, meaning that inflation in Nigeria will be at a record high. In view of the fact that global and regional inflation has slowed and, in many cases, is falling, Nigeria is fast becoming an outlier, which has become a cause for concern.

Analysts question the credibility of Nigerian data and the disparity between its rising inflation and the global downtrend. This discrepancy is attributed to imported inflation, driven by nominal global commodity prices and a 38.84% depreciation of the naira in 2023. Bloomberg has ranked Nigeria’s currency as the third worst-performing currency among the 154 currencies it tracks globally.

Inflation is estimated to decline in 2024

Inflation expectations are more important than historical inflation. Even though inflation in Nigeria has increased consistently in 2023. Many experts are projecting a significant decline in 2024. According to EIU, inflation in Nigeria is expected to fall to 23.6% in 2024 and 17% in 2025. These projections are not unrealistic, as Nigeria is likely to see a moderation in inflationary pressures in H2 2024.

The FDC Think Tank shares its inflation estimates and outlook in the download and link below.

Enjoy your read!