Agency says projected surge reflects CPI rebasing effects, not underlying economic pressures
The National Bureau of Statistics (NBS) has announced plans to normalise Nigeria’s inflation data for December 2025, following concerns over a projected spike in the Consumer Price Index (CPI) driven by technical factors.
The disclosure was made on Monday during a virtual stakeholders’ engagement jointly convened by the NBS and the Nigerian Economic Summit Group (NESG).
According to the Bureau, the anticipated jump in headline inflation is largely the result of statistical base effects arising from the recent rebasing of the CPI, rather than a reflection of worsening economic conditions.
Recent forecasts by analysts have pointed to a potential rise in December inflation, with estimates ranging between 31.4 per cent and 32.4 per cent year-on-year, largely attributed to these base effects.
Explaining the Bureau’s position, the Statistician General of the Federation and Chief Executive Officer of NBS, Adeyemi Adeniran, said the spike stems from the adoption of 2024 as the new CPI base year, replacing the 2009 base that had been in use for 15 years.
He noted that base effects are a well-known feature of index-based statistics, especially when price comparisons are made across periods with unusually high or low values.
“Following the rebasing exercise and the methodology adopted for December 2025, a significant but artificial increase in inflation is expected,” Adeniran said. “This is due to the base effect created by setting December 2024 equal to 100 after rebasing.
“Such effects are not unusual in statistical practice, but when they are arithmetic in nature and do not reflect structural changes in the economy, it becomes important to clearly explain them to data users.”
He added that the Bureau’s decision to address the issue proactively was guided by transparency and accountability.
“Our goal is to present a clear picture of actual price movements, not to amplify a spike that does not represent economic reality,” Adeniran said.
In his opening remarks, NESG Chief Executive Officer, Tayo Aduloju, stressed the growing importance of credible inflation data as Nigeria transitions from economic stabilisation to consolidation.
“As we move from crisis management to growth management, the CPI becomes even more critical,” Aduloju said. “Headline inflation should help us understand inflation dynamics, not just trigger reactions to numbers.”
He warned that misinterpreting technical inflation spikes during this phase could undermine policy gains, noting that inaccurate signals could affect monetary policy, fiscal planning, wage negotiations and investment decisions.
Delivering a technical presentation, Director of Price Statistics at NBS, Dr Ayo Anthony, outlined the methodological challenges created by the rebasing exercise.
He explained that the CPI was last rebased in 2009, despite global best practice recommending rebasing every five years. Over the 15-year gap, consumption patterns changed significantly, leading to the addition of more than 400 new products to the CPI basket and the removal of over 200 outdated items.
The rebased CPI now includes 934 products classified under 13 COICOP divisions, Anthony said, adding that linking the new series to the old one was necessary to calculate year-on-year inflation.
“To achieve this linkage, December 2024 was set equal to 100,” he explained. “While this allowed continuity, it also introduced the base effect responsible for the projected spike.”
Anthony warned that without adjustment, December 2025 inflation could appear overstated due solely to arithmetic factors.
To address this, he said the NBS would apply a normalisation process in line with the CPI Manual 2020, which allows the use of an average reference period when a single-month base proves unsuitable.
“Instead of using December 2024 alone, the average CPI for January to December 2024 will be set equal to 100,” he said. “This removes the artificial distortion and provides a more accurate picture of inflation trends.”
He clarified that the adjustment would affect inflation figures published between January and December 2025, but the impact would be minimal and fully disclosed.
“We are not concealing anything,” Anthony said. “For transparency, we will still reference the artificial spike in our reports.”
He added that the decision followed consultations with key technical partners, including the International Monetary Fund, World Bank, and the Central Bank of Nigeria.
Looking ahead, Anthony noted that the base effect would no longer apply from January 2026, as inflation calculations would rely entirely on the rebased CPI series.
The NBS used the engagement to reiterate the need for regular rebasing of key economic indicators, stressing that timely updates help prevent statistical distortions.
The Bureau reaffirmed its commitment to methodological rigour, transparency, and sustained stakeholder engagement, as it works to strengthen confidence in Nigeria’s official economic data.
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