Nigeria’s inflation rate is likely to drop slightly to 34.5% by December 2024, a decrease of 0.25 percentage points, according to Afrinvest Research. This expected slowdown is linked to higher food prices from the previous year and an improvement in the exchange rate, with the naira expected to strengthen below N1,600/$.
However, some analysts believe consumer prices could still go up because of increased demand during certain times of the year and ongoing high transportation costs. The Economist Intelligence Unit (EIU) agrees with this view, forecasting inflation to reach 35.2% by December 2024 and average around 27.7% in 2025.
Food prices, which are the main reason for rising costs, have kept going up, reaching 39.93% in November. This increase is because of problems like insecurity and flooding affecting harvests. Despite efforts by the Central Bank of Nigeria (CBN), inflation remains high due to rising food and energy costs.
In the future, prices are expected to go down a bit in the first half of 2025, helped by a high starting point. Economists emphasize the need for fiscal authorities to address food inflation for a quicker reduction in prices
