Nigeria’s inflation drops below 20% as NGX surges up 44.74% year-to-date
Nigeria’s consumer price index (CPI) inflation rate dropped significantly to 18.02 percent in September 2025, falling below the 20 percent threshold for the first time in three years and strengthening the case for interest rate cuts.
This major slowdown from 20.12 in August was the largest decline this year, driven by a sharp drop in food inflation to 16.87 percent. Simultaneously, the Nigerian Exchange Group All-Share Index (NGX-ASI) extended its robust upward trajectory, closing the week with a year-to-date return of +44.74 percent, as positive sentiment from the inflation data and strong sectoral performance.
Read also: CBN nears inflation target as prices ease steadily
China’s inflation fell to 0.30 percent
The Chinese Bureau of Statistics reported that the consumer price index (CPI) fell by 0.30 percent from 0.40 percent YoY in August.
This follows continuous deflationary pressures, as both consumer and producer prices remained in negative territory in September 2025.
Also, its Producer Price Index (PPI)contracted by 2.30 percent compared to 2.90 percent in August, the slowest decline in seven months.
Analysts at Meristem Securities said that the moderation in producer price declines reflects government efforts to curb excess competition across key industrial sectors.
However, food inflation remained a significant drag, down 4.40 percent, led by a 17 percent slump in pork prices and seasonal declines in vegetable prices.
“Overall, China’s current inflation landscape suggests that the government would likely extend the stimulus program, especially noting the improvement in household demand. However, renewed trade tension with the United States could undermine confidence and further delay a sustained recovery in spending patterns,” Meristem analysts said.
US fiscal deficit drops to $1.7 trillion
The U.S. fiscal deficit eased slightly by $41.00 billion in the full year of 2025 to $1.70 trillion from $1.80 trillion in 2024, marking the first annual improvement since 2022.
The moderation was primarily driven by a surge in tariff revenue under the new administration, as net customs receipts rose to a record $195 billion, up $118.00bn from he previous year, following the implementation of new trade levies.
In addition, sharp cuts to education spending, including a mandated $131.00 billion reduction in September, contributed to a temporary monthly surplus at the close of the fiscal year.
“ However, the improvement masks deeper structural challenges. Corporate tax receipts declined sharply due to retroactive deductions approved by Congress, while mandatory spending on Social Security, healthcare, and debt interest continued to accelerate,” analysts noted.
The country’s interest payments alone surged to a record $1.20 trillion, now the second-largest component of the federal budget. Consequently, the fiscal deficit-to-GDP ratio dipped only marginally to 5.90 percent from 6.30 percent in 2024.
“ While tariff gains and one-off spending cuts provided temporary relief, the underlying fiscal trajectory remains unsustainable without meaningful reforms to entitlement programs and revenue policy leaving medium-term risks tilted toward higher borrowing costs and potential market volatility,” the analyst said.
Read also: Slowing inflation shows Tinubu’s reforms paying off – Bwala
Nigeria’s 2025 GDP growth forecast to 3.90 percent – IMF
The International Monetary Fund (IMF) has raised Nigeria’s 2025 growth forecast to 3.9 percent, up from 3.4 percent, citing improved investor confidence, higher oil production, and supportive government policies. It also lifted the 2026 outlook to 4.2 percent, suggesting stronger momentum ahead. The IMF said reforms in the energy and financial sectors, along with a more transparent foreign exchange market, are helping the economy recover and; however, it urged the government to stay consistent with its policies and deepen reforms to keep growth on track.
Nigeria’s inflation fell below 20 percent for the first time in three years
Nigeria’s consumer price index (CPI) inflation rate dipped below the 20 percent threshold, slowing to 18.02 percent, the lowest level recorded in three years, strengthening the case for a more aggressive interest rate cut by the Monetary Policy Committee (MPC) at its upcoming November meeting.
The inflation figure was lower than the 19 percent projected by many analysts.
The drop to 18.02 percent in September 2025, from 20.12 percent in August 2025, is the largest decline seen this year. Other inflation indicators, such as food inflation, a significant driver of overall inflation, also saw big drops in their figures from 21.87 percent to 16.87 percent in September. Core inflation, a measure of inflation that excludes volatile or temporary price elements, primarily food and energy prices.
Read also: Nigeria’s inflation falls to 18.02% in September on drop in food prices
Nigeria’s Oil output falls further to 1.37 mbpd
Nigeria’s crude oil production declined for the second month in a row to 1.37 million barrels per day (mbpd) in September 2025, from 1.43 mbpd in August, according to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The fall was linked to sabotage, pipeline vandalism, and disputes between the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and Dangote Refinery that led to a three-day strike. Although output earlier surpassed the Organisation of Petroleum Exporting Countries’ (OPEC) 1.50 mbpd benchmark in January, June, and July, weaker production and oil prices around $60.22 and $56.68 per barrel raise fiscal concerns and the risk of a wider budget deficit.
Dangote Cement Expands to Côte d’Ivoire
Dangote Cement has officially opened a new plant in Attingue, Côte d’Ivoire, with a capacity of 3 million tonnes per year. This makes Côte d’Ivoire the 11th African country to host a Dangote Cement facility.
The plant is expected to create around 1,000 jobs and help reduce the country’s dependence on imported cement.
After the announcement, Dangote Cement’s stock rose by 4.35 percent, as investors reacted positively. The company is expected to benefit from Côte d’Ivoire’s growing construction and infrastructure projects, even though competition and logistics costs may pressure profits at the start.
The NGX ends the week up by 44.74% year-to-date
On Friday, the NGX-ASI extended its upward momentum, increasing by +1.35 percent to settle at a year-to-date (YtD) return of +44.74 percent.
This was driven by positive performance across all sectors except the banking sector. The NGX-Industry and NGX-Insurance sectors saw the most gains, up by 2.79 percent, while the NGX-Banking sector dipped by 0.13 percent.
Market activity increased, with total trading volume and value rising to 2.42 billion units and N63.51 billion, respectively, compared to 2.26 billion units and N57.23 billion recorded in the prior week.
Read also: Cardoso sees inflation easing further on tight policy, stable fx
Nigerian fixed income market highlights
CBN held an oversubscribed OMO auction, initially offering N600 billion but allotting N2.10 trillion in subscriptions at stop rates between 19.40 percent and 19.90 percent.
In the Treasury Bills secondary market, the average yield saw a slight 17.25 percent from 17.2 percent as buyers positioned ahead of the OMO results, particularly on short- to mid-dated papers, yield drop.
Similarly, the bond market saw the average yield moderate by one percent to 15.89 percent. This was as investors were locking in on long-dated bonds (e.g., JUN-2038, JUN-2032), despite mild profit-taking on others.
