BREAKING NEWS, Business
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The National Bureau of Statistics says rate of inflation in Nigeria now is 16.5 percent
| By Anayo Ezugwu | Aug 1, 2016 @ 01:00 GMT |
THE Consumer Price Index, CPI, measuring inflation in the Nigerian economy has risen to its highest point of 16.5 percent in over 10 years. The National Bureau of Statistics, NBS, in its latest report released on Monday, July 18, shows that inflation for the month of June spiked to its highest point since October 2005.
The new inflation rate is the highest rate since October 2005, according to data obtained from the Central Bank of Nigeria, CBN’s, website. Prices rose 1.7 percent in the month. Nigeria imports at least 70 percent of its refined fuel, despite pumping 1.6 million barrels of crude a day in June, according to the International Energy Agency, and faced fuel shortages as retailers struggled to get foreign currency to buy products during a 15-month naira peg that was removed last month.
The currency’s official exchange rate weakened to more than N280 per dollar, compared with the fixed rate of N197-199, and the naira trades at around N360 on the black market, increasing prices for consumers.
The National Bureau of Statistics, said in a statement that “In June, the Consumer Price Index, CPI, which measures inflation, continued to record relatively strong increases for the fifth consecutive month.
“The Headline index increased by 16.5 percent (year-on-year), 0.9 percent higher from rates recorded in May (15.6 percent). While most COICOP divisions, which contribute to the Headline index, increased at a faster pace, the increase was, however, weighed upon by a slower increase in three divisions: Recreation and Culture, Restaurant and Hotels, and Miscellaneous Goods and Services.
“Year-on-year, energy prices, imported items and related products continue to be persistent drivers of the core sub-index. The core index increased by 16.2 percent in June, up by approximately 1.2 percent points from rates recorded in May (15.1 percent). During the month, the highest increases were seen in the electricity, liquid fuel (kerosene), furniture and furnishings, passenger transport by road, and fuels and lubricants for personal transport equipment.
“While imported foods continue to increase at a faster pace, the food sub index, on the aggregate, increased, albeit at a slower pace in June relative to May. The index increased by 15.3 percent (year-on-year) in June up by 0.4 percent from rates recorded in May. The index was weighted upon by a slower increase in the vegetables and ‘sugar, jam, honey, chocolate and confectionery’ groups. Month-on-month, the headline index has moved in a sideways fashion since February, the first month of a pronounced increase in rates this year. Specifically in June, the index increased by 1.7 percent, lower by roughly 100 basis points from rates recorded in May.”
The average price for a litre (0.26 gallon) of gasoline was N148.5 ($0.52) in June, one percent less than in May, according to a separate report from the statistics bureau. The June gasoline price was 32 percent higher than a year earlier. Food prices rose 15.3 percent in June from a year earlier, compared with 14.9 percent in May.
The highest increases were in the costs of fish and meat, fruit and vegetables and bread and cereals, the statistics office said. “Year-on-year, both the Urban and Rural indices increased albeit at a faster pace in June. The Urban index rose by roughly 100 basis points from 17.1 percent in May to 18.1 percent in June, while the Rural Index increased by 0.7 percent points from 14.3 percent in May to 15.1 percent in June. On a month-on-month, basis both the urban and rural indices increased at a slower pace in June.
The urban index increased by 1.8 percent during the month, 120 basis points lower from 3.0 percent in May. In addition, the rural index increased by roughly 1.6 percent in June, 90 basis points lower from 2.5 percent in May. “The percentage change in the average composite CPI for the twelve-month period ending in June 2016 over the average of the CPI for the previous twelve-month period was 11.4 percent, higher from 10.7 percent recorded in May.
“The corresponding twelve-month year-on-year average percentage change for the urban index increased from 11.2 percent in May to 11.9 percent in June, while the corresponding rural index also increased from 10.4 percent in May to 10.9 percent in June. While the food sub-index increased at a faster pace (increasing from 14.9 percent in May to 15.3 percent in June) driven by imported products and other food groups, the rate of increases in some food groups in particular; vegetables and sugar, jam, honey, chocolate and confectionery groups slowed, weighing on the index.
“Over the first half of the year, the food index averaged 13.0 percent (year-on-year), up by 3.5 percent points from 9.5 percent in the corresponding period in 2015. On a month-on-month basis, the food sub-index slowed by roughly 1.1 percent points from 2.6 percent in May to 1.4 percent in June.
“On a month-on-month basis, the highest price increases were recorded in the fish, meat, bread and cereals, and fruits groups. The average annual rate of change of the Food sub-index for the twelve-month period ending in June 2016 over the previous twelve month average was 11.7 percent, 0.5 percent points from the average annual rate of change recorded in May (11.2 percent).
“The all items less farm produce or core sub-index increased by 16.2 percent in June (year-on-year), up approximately by 1.2 percent points from 15.1 percent recorded in May. The core sub-index has increased at a faster pace for five consecutive months. Over the first six months of the year, the core sub-index increased by 12.8 percent, up 5.2 percent points from rates recorded in the corresponding period in 2015.
“On a month-on-month basis, after a brief uptick in May, the rate of increases in the core sub-index continued to slow in June. The index increased by 1.8 percent, lower by 0.9 points from rates recorded in May. In June, on a month-on-month basis, the highest price increases were recorded in motor cars, electricity, solid fuels, fuels and lubricants for personal transport equipment groups amongst others. The average twelve month annual rate of rise of the index was recorded at 10.9 percent for the twelve-month period ending in June 2016, roughly 0.7 percent points higher from the twelve month rate of change recorded in May (10.2 percent).”
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