Seasonal ARIMA modeling of inflation in Nigeria

Saheed A.  Ajobo; Oluwaseun A.  Adesina; David I. Ohida; Kafayat A.  Alobaloke; OlaOluwa S. Yaya; Mary M. Adepoju

doi:https://doi.org/10.59139/stattrans-2026-033

Seasonal ARIMA modeling of inflation in Nigeria

Saheed A. Ajobo Department of Statistics, University of Ibadan, Ibadan, Nigeria , Oluwaseun A. Adesina Department of Statistics, Ladoke Akintola University of Technology, Ogbomosho, Nigeria , David I. Ohida Department of Statistics, University of Ibadan, Ibadan, Nigeria , Kafayat A. Alobaloke Department of Statistics, University of Ibadan, Ibadan, Nigeria , OlaOluwa S. Yaya Department of Statistics, University of Ibadan, Ibadan, Nigeria. E-mail address: os.yaya@ui.edu.ng. , Mary M. Adepoju Department of Statistics, Ladoke Akintola University of Technology, Ogbomosho, Nigeria ORCID:https://orcid.org/0009-0002-1445-931 Statistics in Transition new series, vol. 27, 2026, 3, pages: 183-206 Published online: 9 September 2026 https://doi.org/10.59139/stattrans-2026-033 Citation: Ajobo S. A., Adesina O. A., Ohida D. I., Alobaloke K. A., Yaya OO. S., Adepoju M. M., 2026. Seasonal ARIMA modeling of inflation in Nigeria. Statistics in Transition new series, 27(3), pp. 183-206. https://doi.org/10.59139/stattrans-2026-033

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ABSTRACT

The success of monetary and fiscal policies in controlling inflation rates relies largely on the availability of accurate inflation forecasting models. Thus, updated models that require seasonality are required. This study applies the Seasonal Autoregressive Integrated Moving Average (SARIMA) process to model the consumer price indices in Nigeria, specifically headline, food and core inflation. The study analyses monthly inflation rate data for the period from January 2003 to December 2023, obtained from the Central Bank of Nigeria’s website. The findings of the study identify the best-fitting SARIMA models for each inflation measure. The SARIMA (1,1,0)(2,0,1)12 model is selected as the most appropriate for headline inflation, while the SARIMA(2,1,2)(2,0,2)12 and SARIMA(1,0,1)(2,0,1)12 models are chosen for food inflation and core inflation, respectively. Caution is then required when applying SARIMA models in forecasting inflation, with emphasis on the importance of considering other relevant economic and socio-political factors that may influence inflation trajectories.

KEYWORDS

CPI inflation, Nigeria, SARIMA, food inflation

JEL

C22

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