Journal · 2025
Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts
Abstract
Inflation significantly affects Nigeria's purchasing power and economic stability, thus necessitating targeted policy responses. This study assesses the Nigeria's inflation dynamics from 2008 to April 2024, with a focus on the effects of exchange rate volatility and crude oil prices on the inflation dynamics especially across Consumer Price Index (CPI) categories. Using monthly data from the National Bureau of Statistics (NBS) and the Central Bank of Nigeria (CBN), time series decomposition, Granger causality tests, linear regression, and SARIMA/SARIMAX forecasting were employed in the analysis. Results indicate that the exchange rate significantly drives inflation, while crude oil prices have a negligible direct effect. Food CPI was most sensitive to inflationary pressures, whereas communication CPI was least affected. Forecasts suggest a potential decline in inflation in 2025, indicating possible economic stabilization. Recommendations vary from stabilizing the exchange rate, intervening in the foodstuff market, diversifying the economy, investing in the communications sector, and holding policies to bring down inflation and gain sustainable growth.
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Publication details
- Venue
- International Journal of Development Mathematics (IJDM)
- Type
- Journal · 2025
- DOI
- 10.62054/ijdm/0204.14
- Citations
- 0 · via Crossref, 17 September 2026
Cite this publication
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APA
Akuma, C. F., Hewage, P., Bren, T., Amaechi, C. V., Eche, A., Akuma, C. F., & Akuma, D. (2025). Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts. International Journal of Development Mathematics (IJDM). https://doi.org/10.62054/ijdm/0204.14
Harvard
Akuma, C.F., Hewage, P., Bren, T., Amaechi, C.V., Eche, A., Akuma, C.F. and Akuma, D. (2025) 'Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts', International Journal of Development Mathematics (IJDM). doi: 10.62054/ijdm/0204.14.
IEEE
C. F. Akuma, P. Hewage, T. Bren, C. V. Amaechi, A. Eche, C. F. Akuma, and D. Akuma, "Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts," International Journal of Development Mathematics (IJDM), 2025. doi: 10.62054/ijdm/0204.14.
Vancouver
Akuma CF, Hewage P, Bren T, Amaechi CV, Eche A, Akuma CF, et al. Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts. International Journal of Development Mathematics (IJDM). 2025. doi: 10.62054/ijdm/0204.14.
MLA
Akuma, Chijiuka Fortune, et al.. "Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts." International Journal of Development Mathematics (IJDM), 2025. https://doi.org/10.62054/ijdm/0204.14.
Chicago
Akuma, C. F., Hewage, P., Bren, T., Amaechi, C. V., Eche, A., Akuma, C. F., Akuma, D.. "Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts." International Journal of Development Mathematics (IJDM) (2025). https://doi.org/10.62054/ijdm/0204.14.
BibTeX
@article{akuma2025, title={Forecasting Nigerian Inflation: A SARIMAX and Granger Causality Analysis of Exchange Rate and Crude Oil Price Impacts}, author={Akuma, Chijiuka Fortune and Hewage, Pradeep and Bren, Tighe and Amaechi, Chimeremeze V. and Eche, Amarachi and Akuma, Chijiuka Fortune and Akuma, Duru}, journal={International Journal of Development Mathematics (IJDM)}, year={2025}, doi={10.62054/ijdm/0204.14}, }