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As President Bola Tinubu’s reforms continue to take hold, Nigeria’s annual inflation rate increased to its highest level in almost two decades in July at 24,08 percent compared to 22,79 percent in June, deepening a cost-of-living issue in Africa’s largest economy.
Since 2016, Nigeria’s inflation rate has been in the double digits, eroding income and savings and forcing the central bank to raise interest rates to their highest level in almost two decades. This is supported by the National Bureau of Statistics (NBS) most recent publication of the Consumer Price Index (CPI) data for July 2023.
In the biggest measures seen in years, Tinubu lifted limits on foreign exchange trading, which has depreciated the naira by more than 40 percent, and abolished a popular but expensive gasoline subsidy, prompting prices to quadruple.
The Food inflation rate rose to 26,98 percent in July 2023, representing a 1,73 percent point increase from 25,25 percent recorded in the previous month and 4,97 percent points higher than 22,02 percent recorded in the corresponding period of 2022.
“The rise in food inflation on a year-on-year basis was caused by increases in prices of oil and fat, bread and cereals, fish, potatoes, yam and other tubers, fruits, meat, vegetable, milk, cheese, and eggs,” the statistics agency notes.
The NBS made it clear last month that the consequences of the elimination of fuel subsidies and the unification of the currency rate might not be fully reflected in the June inflation statistics.
This was done in response to concerns raised by analysts and the Nigerian public that the country’s inflation numbers might not be giving a full picture of the situation. However, the figures are now showing an increase consistent with the known economic trends. The sharp increase in food, energy, and transportation costs is proof of this. – Business Insider Africa
Online Reporter