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Nigeria’s inflation rate jumps to 15.75 per cent, highest since November 2017

Nigeria’s inflation rate jumped to 15.75 per cent in December, the highest inflation level in more than three years.

In November 2017, the nation’s consumer inflation rate stood at 15.90 per cent.

Data released on Friday by the National Bureau of Statistics (NBS) shows that inflation stood at 15.75 per cent in December, compared with 14.89 per cent in November.

The December figure marks the 16th straight month of increases in inflation rate.

The latest figure is 0.86 per cent points higher than the rate of 14.89 per cent recorded in November 2020.

Food inflation rose by 19.56 per cent in December compared to 18.3 per cent recorded in the previous month, while core inflation stood at 11.37 per cent, up by 0.32 per cent when compared to 11.06 per cent recorded in November 2020.

“This rise in the food index was caused by increases in prices of bread and cereals, potatoes, yam, and other tubers, meat, fruits, vegetable, fish and oils, and fats,” it added.

Analysts at the Financial Derivatives Company Limited, led by foremost economist Bismarck Rewane, had said last week predicted that headline inflation would increase by 0.51 per cent to 15.4 per cent in December, describing it as “a hydra-headed monster that has eroded the disposable and discretionary income of consumers.

“The continued rise in the general price level is driven largely by forex rationing, output and productivity constraints, higher logistics and distribution costs,” they said.

The analysts noted that consumer disposable income had been negatively affected by the hike in electricity tariffs, general reductions in subsidies, and improved tax mobilisation.

“We believe the sustained pressure in the food basket is reflective of the impact of the underwhelming harvest season, persistent security challenges in the food-producing regions, and festive induced demand which further widened the demand-supply imbalance,” Cordros Capital Limited said in an emailed note on Friday.

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