CPI rebasing: Nigeria’s rebased CPI basket to cover 960 items

In a bid to bring more items into the basket and compute an index that reflects current consumption patterns, Nigeria is undergoing a rebasing of its Consumer Price Index (CPI). The revised methodology includes using data from the 2023 Nigerian Living Standards Survey to capture household expenditure, with a survey of rare items conducted in 2024. The weight for the CPI is based on monetary expenses, excluding gifts and home production. The computation of the index follows the modified Laspeyres method and a short-term relative index. A key decision in this process is the selection of the base year, with 2024 chosen due to its relative stability compared to the price fluctuations in previous years. The rebasing also extends the scope of indices tracked, adding services, energy, gold, and other special indices to the CPI. This expansion aims to meet stakeholders' needs and align with global best practices. The Chief Economist of the Nigerian Economic Summit Group emphasized the critical role of sensitization workshops for national planning. The rebased CPI will provide a more recent narrative of the economy, validating the current situation and influencing past narratives. This updated data will be crucial in scenario planning, forecasting economic trends, and directing government policies towards sectors with potential growth. Overall, the rebasing of Nigeria's CPI marks a significant shift in economic data analysis, with far-reaching implications for national planning and economic strategy.