Nigeria’s headline inflation is expected to decline for the seventh consecutive month in October 2025, with analysts projecting a range of 16.20% to 17.76%, down from 18.02% in September as reported by the National Bureau of Statistics (NBS).
The anticipated moderation is driven largely by easing food inflation, improved FX conditions, and favourable supply dynamics across key commodities.
However, persistent domestic cost pressures, especially from energy and transport, are expected to slow the pace of disinflation.
Despite these constraints, experts agree that the softer inflation picture strengthens the case for another Monetary Policy Rate (MPR) cut at the next MPC meeting.
What experts are saying
Research and Insights lead, Norrenberger Financial Group, Samuel Oyekanmi
Oyekanmi noted that inflation is likely to ease slightly in October 2025, supported by the continued moderation in food prices. He explained that “despite the favourable food inflation outlook, rising domestic energy costs, particularly LPG and petrol, may restrict the speed of disinflation”. According to him, the softer inflation trajectory strengthens the case for an additional policy rate cut at the next MPC meeting.
Head of Research at Arthur Steven Asset Management Limited, Abdulsalam Ayoade
Ayoade highlighted that Nigeria’s headline inflation has now eased for six consecutive months, driven largely by waning food inflation and improved FX stability. He expects this downward trend to extend into October, projecting inflation to fall further to about 16.51%. With disinflation gaining momentum and monetary conditions becoming more supportive, he also anticipates that the MPC will deliver another 50bps cut in the MPR at its final meeting of the year.
Portfolio Manager at CFG Africa, Bolujoko Mayowa
Mayowa stated that the disinflationary trend should continue into October, helped by favourable supply-side conditions and statistical effects. He noted that food prices remained stable during the month due to higher market supply from the peak harvest season, a development that helped ease month-on-month food inflation pressures. FX stability, with the naira trading below N1,480/$, also limited imported inflation pass-through, particularly for essential items.
He added that base effects from elevated price levels in the corresponding period of 2024 would further suppress the year-on-year reading. However, lingering cost-push factors—such as rising gas prices from supply disruptions and temporary PMS scarcity that pushed transport fares higher—may exert some upward influence.
Considering these dynamics, Mayowa projects that inflation will decline in October, albeit at a slower pace than in September, settling within a range of 16.20% to 17.76%. Taking these dynamics into account, we project that the inflation rate will decline in October, though not as sharply as recorded in the previous month, settling within a range of 16.20% to 17.76%.
Factors that affected inflation in October 2025
- Moderating food prices: Food inflation remained the biggest driver of the projected decline. Increased supply from the peak harvest season improved market availability of major staples, easing month-on-month price pressures.
- FX stability: The naira traded below N1,480/$ frequently in October, reducing imported inflation pass-through on food, household necessities, and manufactured goods.
- Rising domestic energy costs: Higher LPG prices, driven by supply disruptions, added upward pressure to household cooking and heating costs. Petrol scarcity in select states pushed transport fares higher, limiting the pace of disinflation.
- Improved supply conditions: Better logistics, improved local production flows, and easing bottlenecks helped stabilize prices across food and non-food items.
Nairametrics’ take
The expected slowdown in October inflation suggests that Nigeria’s path to easing price pressures is finally taking shape. Better food supply and a steadier FX market are helping calm things down, but the reality is that rising energy costs and transport hiccups are still keeping households on edge. Price stability is improving, but it’s not out of the woods yet.
Most analysts agree inflation will drop again, but how far it falls depends largely on how quickly energy issues are resolved and whether the naira can hold its ground. A softer number in October could give the MPC room to cut rates one more time this year, though they’ll still tread carefully given the structural challenges that haven’t gone away.
In the end, October’s inflation reading will show whether Nigeria is genuinely moving into a more stable pricing environment or simply benefitting from seasonal and base effects. Either way, it will be a key marker for how the rest of the year unfolds.
