The Independent Media and Policy Initiative (IMPI) has attributed its successful projection of a 14 per cent inflation rate by the end of the year to what it described as a painstaking and data-driven analysis of President Bola Tinubu’s economic reforms.

In a statement signed by its Chairman, Dr Omoniyi Akinsiju, the think tank said its forecast was anchored on empirical models and evolving macroeconomic indicators, even as President Tinubu himself projected a 15 per cent inflation rate in his 2025 budget speech.

According to IMPI, its analysts were convinced as far back as September that inflation would outperform the government’s target, based on a Predictive Regression (PR) analysis that revealed stronger disinflationary signals across the economy.

IMPI said: “When in September we initially projected a drop in inflation by the end of 2025 to 17 percent it was based on a trend analysis of the Purchasing Manager’s Index (PMI) reports issued by the Central Bank of Nigeria (CBN) since the beginning of the year in relation to the Consumer Price Index (CPI) reports of the National Bureau of Statistics (NBS).

“But we were forced to review our position downwards, barely a month later, in our policy statement 031 issued in October, when we established a stronger pattern of increased productivity and general price reduction with higher intensity beginning from August 2025.”

The group explained that access to a fresh set of data and the deployment of its PR model necessitated a further downward review of its projection.

“So with the benefit of a new set of data available to us via the Predictive Regression (PR) model of statistical analysis, we concluded that a 14 per cent inflation rate was a more realistic figure before the end of the year than the earlier projected 17 per cent.

“We were able to establish a consistent pattern of increased productivity and general price reduction with higher intensity beginning from August 2025.”

It further linked the disinflation trend to movements in the Purchasing Managers’ Index, noting a strong inverse relationship between rising productivity and falling prices.

“After establishing a link between an increasing Purchasing Manager’s Index with the disinflation trend in the country, our analysts at IMPI noted that ‘the trend in the relationship and movements between the PMI and inflation is further sustained by their respective October figures with the CBN Composite PMI recording 55.4 index points, a significant increase in the PMI recorded between April and September 2025.

“This larger margin of difference is also reflected in the country’s headline inflation rate, which declined at a much faster rate to 16.50 per cent in October 2025 from 18.02 per cent in September 2025, a decrease of 1.96 per cent.’”

IMPI explained that higher PMI readings typically signal declining inflationary pressures, as they point to stronger production and productivity across the economy.

“To put this in context, an increase in PMI reflects a decline in inflation because a PMI hike is suggestive of a higher growth momentum in production and productivity measured across 36 sectors of the economy.”

The think tank said it was therefore unsurprised by the continued easing of inflation in November.

“We were therefore not surprised that the headline inflation dropped for the eighth consecutive month in November to 14.45 per cent by nearly 200 basis points on the back of stable macroeconomics.”

Looking ahead, the organisation expressed optimism that the disinflationary trend would persist into 2026, provided the administration remains consistent with its policy direction.

“As many have posited, a combination of monetary, fiscal and structural policies is necessary to consolidate the gains of the trend with a view to ensuring that more Nigerians feel the effects of the ongoing Tinubu reforms.”

It also cited the federal government’s mechanisation plans as a key driver of future price stability in the agricultural sector.

“We are, however, optimistic that the disinflation trend will continue deep into 2026 now that the federal government has concluded plans to move the 2,000 tractors acquired from Belarus into farms across the country from January.

“It is gratifying that rather than distribute the tractors to individuals, they are to be allocated through a transformative mechanisation service-provider model designed to ensure that each tractor covers a minimum of 500 hectares of farmland, meaning that all tractors can cultivate a combined 100,000 hectares while serving millions of farmers.”

IMPI added that the economy had markedly improved compared to the inflationary pressures of the previous year.

“Indeed, things have changed from the high inflationary environment of 2024 as 2025 winds down. The economy has transmuted to a vastly improved one with more Nigerians more likely to be wheeled out of poverty as a result of the ongoing disinflation in the economic space.”