This is as Nigeria’s inflation fell sixth month in a row, down to 18.02 percent in September, its lowest level in more than three years.
Development Economist, Professor Ken Ife, has said that Nigeria’s current inflation narration is not straightforward but a complex case of stagflation.
He described the situation as a rare economic condition where multiple forms of inflation occur at the same time.
Speaking on Channels Television’s The Morning Brief on Monday, Prof. Ife explained that, unlike other economies where only one or two types of inflation are active at a time, Nigeria is experiencing all four simultaneously, making economic recovery difficult.
This is as Nigeria’s inflation fell sixth month in a row, down to 18.02 percent in September, its lowest level in more than three years.
“What we have is not a straightforward inflation. I’ve said it many times that what we have is stagflation, and stagflation is the most complicated form of inflation where all the possible types of inflation are active simultaneously. Rarely do you have it in other economies, but in our case, all four are happening at once,” he said.
He identified the first as demand-pull inflation, driven by excess liquidity and massive cash flow chasing fewer goods and services.
According to him, Nigeria’s monetary authorities have been “sucking liquidity” through inflation-targeting policies, but the challenge persists because the money in circulation was not backed by productivity gains.
“You can print money, but you print it under some conditions, either someone has sent in $20 billion into your economy, or there’s a massive productivity gain. None of these is the case; we’re just printing inflation,” he added.
The second, cost-push or structural inflation, is linked to the rising cost of transportation, energy, and insecurity, which continues to affect the production and distribution of goods, particularly food.
Development Economist, Professor Ken Ife, while appearing on The Morning Brief, Monday, October 20, 2025.
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He also described imported inflation as another major driver, noting Nigeria’s heavy dependence on imports makes it vulnerable to global disruptions like the COVID-19 pandemic and the Russia-Ukraine crisis.
“We have gas and oil, but Russia controls 40% of the gas to Europe. When they turned down that tap, prices went high. We are Europe’s second trading partner, so all we are importing from there is inflation,” Prof. Ife stated.
The fourth factor, which he said is rarely discussed, stems from regional food demand and currency devaluation.
He revealed that Nigeria’s food exports to neighbouring countries like Niger, Chad, and Mali, mostly paid for in naira, have worsened domestic food inflation due to exchange rate differentials.
“We are feeding 300 million people, not 230 million. Our neighbours depend on us for food, and when you go out to these countries, one naira can no longer buy one CFA; it buys 0.7 CFA. Apples I buy here for ₦800 cost ₦3,000 at Seme Border. That shows an 80% devaluation,” he explained.
He added that this cross-border demand allows traders to make up to 200% profit, putting more pressure on domestic food prices.
According to Prof. Ife, while Nigeria has seen a slight drop in food inflation recently due to increased imports, the underlying structural issues of production, currency weakness, and import dependence remain unresolved, making inflation a persistent challenge for policymakers.
Nigeria’s headline inflation rate dropped to 18.02 per cent in September 2025, representing a significant 2.1 percentage point decrease from the 20.12 per cent recorded in August 2025.
This is according to the latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) on Wednesday.
Data from the report indicate that the country has now recorded six consecutive months of declining inflation since April 2025.
The decline comes after a series of statistical adjustments earlier this year, including a change in the base year and a reweighting of items in the consumer price basket. Inflation had previously peaked at nearly 35 per cent in December 2024.
