Start with pension allocation. Nigeria’s pension assets reached ₦26.66 trillion as of October 2025, with about 60% or about ₦16 trillion invested in government securities. If the true yield on government bonds has been negative for much of the past 15 years, then tens of millions of retirement savers weren’t just earning low returns. They lost purchasing power while their nominal balances increased.
This doesn’t only apply to Nigeria. The OECD’s 2024 pension report, based on 2023 data, found that pension systems in Nigeria, Angola and Egypt, where greater than half of assets are invested in notes and bonds, delivered negative real returns. The recent increases in share allocation limits for pension funds in Nigeria are groundbreaking. However, they’re modest relative to the size of the issue.
Under the old CPI methodology, a 91-day Treasury note yielding 18% against inflation of 34.8% was clearly negative in real terms. Under the recalculated CPI, a return of 15% appears roughly neutral to inflation of 15.15%. Has the underlying reality improved or has the measurement modified?
The answer is each.
Inflation has really slowed down. Monthly CPI increases fell below 1% for several consecutive months within the second half of 2025. However, the brand new basis also reduced the measured inflation by around 10 percentage points. Without a continuous series, it’s difficult to separate these effects.
It is evident that the sign has shifted.
From August 2025 to January 2026, real returns were positive for six consecutive months. January 2026 was the strongest month with an actual return of +4.39%, driven by a 2.88% month-on-month decline in CPI and a nominal Treasury yield of 1.38%. The real return index rose from 984 to 1,027, exceeding its base value of 1,000 for the primary time.
After 15 years of negative returns, the destruction of buying power by money isn’t any longer guaranteed. Whether this transformation will prove lasting stays an open query.
