Start with pension allocation. Nigeria’s pension assets reached ₦26.66 trillion by October 2025, of which about 60%, or about ₦16 trillion, was invested in government securities. If real returns on government paper have been negative for most of the past 15 years, millions of retirement savers were not simply earning low returns. They were losing purchasing power while their nominal balances increased.
This is not unique to Nigeria. The OECD’s 2024 pension report, using 2023 data, found that pension systems in Nigeria, Angola and Egypt, where more than half of assets are allocated to bills and bonds, delivered negative real returns. The recent increase in Nigeria’s pension fund equity allocation limit is demonstrably positive. But they are minor compared to the scale of the problem.
Under the old CPI methodology, a 91-day T-bill yielding 18% against 34.8% inflation was clearly negative in real terms. Under the rebased CPI, a yield of 15% appears almost neutral against inflation of 15.15%. Has the underlying reality improved, or has the measurement changed?
The answer is both.
Inflation has actually come down. Monthly CPI growth fell below 1% for several consecutive months in the second half of 2025. But the rebase also reduced measured inflation by about 10 percentage points. Without continuous series, it is difficult to isolate these effects.
What is clear is that the sign has moved.
From August 2025 to January 2026, real returns remained positive for six consecutive months. January 2026 was the strongest month with a +4.39% real return, driven by a 1.38% nominal T-bill return as well as a 2.88% month-on-month decline in CPI. The real returns index rose above its base level of 1,000 from 984 to 1,027 for the first time.
After 15 years of negative returns, cash is no longer guaranteed to destroy purchasing power. Whether that change will prove sustainable remains an open question.
