Nigeria’s Consumer Price Index (CPI), which measures inflation, increased by 14.23 per cent (year-on-year) in October 2020, 0.52 per cent points higher than the rate recorded in September 2020 (13.71 per cent).
Nigeria’s National Bureau of Statistics (NBS), said on Monday that the composite food index rose by 17.38 per cent in October 2020, compared to 16.66 per cent in September 2020.
The nation’s inflation rate for 2019 was 11.40 per cent, a 0.7 per cent decline from 2018. In 2018, it recorded an inflation rate of 12.09 per cent, a 4.43 per cent decline from 2017.
Nigeria inflation rate for 2017 was 16.52 per cent, a 0.85 per cent increase from 2016 while in 2016, inflation rate stood at 15.68 per cent, a 6.67 per cent increase from 2015.
On a month-on-month basis, the Headline index increased by 1.54 per cent in October 2020, this is 0.06 per cent rate higher than the rate recorded in September 2020 (1.48 per cent).
According to the NBS, the percentage change in the average composite CPI for the 12 months period ending October 2020 over the average of the CPI for the previous 12 months period was 12.66 per cent, showing a 0.22 per cent point rise from 12.44 per cent recorded in September 2020.
The urban inflation rate increased by 14.81 percent (year-on-year) in October 2020 from 14.31 per cent recorded in September 2020, while the rural inflation rate increased by 13.68 per cent in October 2020 from 13.14 per cent in September 2020.
On a month-on-month basis, the urban index rose by 1.60 per cent in October 2020, up by 0.04 from 1.56 per cent recorded in September 2020, while the rural index also rose by 1.48 per cent in October 2020, up by 0.08 from the rate recorded in September 2020 (1.40 per cent).
The corresponding 12 year-on-year average percentage change for the urban index is 13.29 percent in October 2020.
This is higher than 13.07 per cent reported in September 2020, while the corresponding rural inflation rate in October 2020 is 12.09 per cent compared to 11.86 per cent recorded in September 2020.
The composite food index rose by 17.38 per cent in October 2020 compared to 16.66 per cent in September 2020.
The NBS said “this rise in the food index was caused by increases in prices of Bread and cereals, Potatoes, Yam and other tubers, Meat, Fish, Fruits, Vegetable, alcoholic and food beverages and Oils and Fats.”
On a month-on-month basis, the food sub-index increased by 1.96 per cent in October 2020, up by 0.08 per cent points from 1.88 per cent recorded in September 2020.
The average annual rate of change of the Food sub-index for the 12-month period ending October 2020 over the previous 12-month average was 15.42 per cent, representing a 0.29 per cent points from the average annual rate of change recorded in September 2020 (15.13) per cent.
The “all items less farm produce” or Core inflation, which excludes the prices of volatile agricultural produce stood at 11.14 per cent in October 2020, up by 0.56 per cent when compared with 10.58 per cent recorded in September 2020.
On a month-on-month basis, the core sub-index increased by 1.25 per cent in October 2020. This was up by 0.31 per cent when compared with 0.94 per cent recorded in September 2020.
The highest increases were recorded in prices of passenger transport by air, hospital and medical services, passenger transport by road, pharmaceutical products, motor cars, vehicle spare parts, maintenance and repair of personal transport equipment, hairdressing salons and personal grooming establishments, miscellaneous services relating to the dwelling, paramedical services and shoes and other footwear.
The average 12-month annual rate of change of the index was 9.96 per cent for the 12-month period ending October 2020, representing is 0.19 per cent points higher than 9.77 per cent recorded in September 2020.
Mr Lukman Otunuga, Senior Research Analyst at FXTM, said “the unsavoury combination of border closures, coronavirus related disruptions and lower interest rates have fuelled inflationary pressures in Africa’s largest economy. With consumer prices projected to jump to almost 14% in October, this will be the highest rate since February 2018.
“In a perfect world, the government may have deployed tight fiscal policy to tame inflationary pressures. However, such a move that involves raising taxes and limiting government spending may do more damage than good at a time where Nigeria continues to heal wounds inflicted by COVID-19. With inflation projected to rise amid ongoing border closures, the Central Bank of Nigeria may have limited room to loosen monetary policy.”