NISER Brief: Consumer Price Index Rebasing and Cost of Living Reality in Nigeria – An Explainer

The Nigerian Institute of Social and Economic Research (NISER) presents a timely and insightful brief on Consumer Price Index (CPI) Rebasing and Cost of Living Reality in Nigeria, shedding light on how recent changes in inflation measurement better reflect the country’s evolving economic landscape.

In 2024, Nigeria rebased its CPI to account for structural shifts in the economy, including the expansion of the digital and informal sectors. New indices—such as Farm Produce, Energy, Services, Goods, and Imported Food—now offer a more nuanced view of price dynamics. This update ensures that inflation statistics are more aligned with current consumption and economic realities.

A key feature of the rebasing is the adjustment in CPI weights. The share of food expenditure has decreased, while spending on transport, education, and healthcare has gained more prominence. This redistribution mirrors a shift in consumer behavior as households adjust to the rising costs of essential services—making the CPI a more accurate reflection of lived economic experiences.

Notably, the rebasing led to a 10.32 percentage point reduction in the official inflation rate. While this statistical drop could have positive implications for economic planning and public perception, it does not translate to immediate relief for households. On the contrary, the cost of critical services—especially healthcare, transport, and education—continues to rise, disproportionately affecting families who depend on private providers.

This brief underscores a crucial insight: inflation is not just a number—it is a lived reality. While methodological improvements in tracking inflation are essential, policymakers must also address the widening gap between statistical improvements and everyday affordability for Nigerians.

Data sources are duly acknowledged.