Naira Hits 6-month High At N1,497/$ As Inflation Slows

Nigeria’s header ostentation complaint moderated to 20.12 per cent successful August 2025 from 21.88 per cent successful July.
This is arsenic the Naira strengthened to its highest level successful six months, trading astatine N1,497 per dollar astatine the Nigeria Autonomous Foreign Exchange Market (NAFEM), signalling improving economical stability.

According to the National Bureau of Statistics (NBS), Nigeria’s ostentation eased by 1.76 percent points month-on-month, the 5th consecutive monthly diminution since April. On a year-on-year basis, the ostentation complaint fell sharply by 12.03 percent points from 32.15 per cent successful August 2024, indicating important easing of inflationary pressures compared to past year.

The 12-month mean ostentation complaint for the play ending August 2025 besides dropped to 24.66 per cent, down 6.6 percent points from the 31.26 per cent recorded successful August 2024.

Food ostentation remained a cardinal operator but eased notably to 21.87 per cent year-on-year successful August 2025 from 37.52 per cent the erstwhile year, portion its monthly complaint declined to 1.65 per cent from 3.12 per cent successful July. Lower prices for staples specified arsenic rice, guinea maize flour, maize flour, millet, and soya beverage contributed to this easing. Regional disparities persist with the highest year-on-year nutrient ostentation successful Borno (36.67 per cent ), Kano (30.44 per cent), and Akwa Ibom (29.85 per cent). At the aforesaid time, Zamfara, Yobe, and Sokoto recorded the slowest increases.

Urban ostentation stood astatine 19.75 per cent year-on-year, down from 34.58 per cent successful August 2024, portion agrarian ostentation eased to 20.28 per cent from 29.95 per cent. Both municipality and agrarian areas recorded little monthly ostentation rates than successful July 2025.

On the currency front, the naira gained 0.27 per cent oregon N4 to commercialized astatine N1,497 to the dollar connected September 15, 2025, its strongest since March 4, 2025. Since the commencement of September, the naira has appreciated by N28.63 oregon 1.89 per cent. The parallel marketplace besides reflected gains, with the naira strengthening by 1.85 per cent to astir N1,510 per dollar.

Analysts property the currency spot to improved liquidity and sustained dollar inflows.

Commenting connected the development, the CEO of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, linked the slowing ostentation to economical stableness and urged the Central Bank of Nigeria’s Monetary Policy Committee to see easing the benchmark involvement rate, presently astatine 27.5 per cent, which importantly exceeds the ostentation rate. He emphasised the request to code persistently precocious nutrient prices and called for argumentation measures targeting basal goods to easiness outgo pressures connected Nigerians.

Dr Yusuf noted that slowing ostentation reflects a unchangeable system and called connected the Monetary Policy Committee of the Central Bank of Nigeria to see easing the benchmark involvement complaint astatine its adjacent gathering adjacent week.

He said with LEADERSHIP, “it is simply a bully happening that we are seeing accordant deceleration successful the ostentation rate. It indicates that the system is stabilising and recovering from the shocks of the reform. It is besides a reflection of the level of assurance investors person successful the economy.”

However, helium raised concerns astir nutrient inflation, which remains high, saying, “There are inactive concerns astir nutrient prices and the outgo of immoderate basal items, which citizens are disquieted about. So, there’s a request for argumentation measures to beryllium taken by the authorities to specifically people issues of nutrient and different basal needs successful the economy. This way, the unit connected citizens tin beryllium mitigated.

“With this accordant deceleration successful inflation, we expect that the CBN should beryllium looking astatine the anticipation of easing its monetary argumentation stance, gradually relaxing the tightening. The Monetary Policy Rate (MPR) is acold higher than the ostentation rate, and the spread has been increasing. The MPR is astir 27.5 per cent, portion ostentation has dropped to astir 20%. You tin spot the gap, truthful we indispensable adjacent it. It’s clip to easiness the monetary argumentation stance astatine slightest gradually.”

The precocious commenced escaped substance organisation is expected to easiness inflationary pressures successful the coming months further. In enactment with this trend, the CBN is apt to chopped the MPR by 25bps astatine its September MPC meeting. However, the caveat is that Nigeria’s ostentation is besides driven by speech complaint volatility and structural bottlenecks. Unless these challenges are addressed, the wide interaction whitethorn beryllium muted. Moreover, seasonal factors specified arsenic “ember” period request and festive activities could antagonistic immoderate of the terms relief, peculiarly arsenic the escaped organisation presently covers lone a fewer states.

Also, Financial Derivatives Company Limited analysts highlighted harvest play effects, accrued user resistance, and CBN’s forex marketplace interventions arsenic factors supporting the ostentation diminution and currency st...