Business - Business & Economy - News - August 16, 2022

Nigeria’s 19.64% inflation rate attains 21 year high level in July

The closest to the latest average level was 18.87% in 2001

By Bassey Udo

The latest Consumer Price Index (CPI), which shows the general trend in average price movement of goods and services commonly used by consumers over a particular period, is the highest level attained since 2001.
The latest CPI Report published by the National Bureau of Statistics (NBS) on Monday showed headline inflation, which rose to 18.60 percent in last month from 17.71 percent in the previous month, rose further to 19.64 per cent on a year-on-year basis in July 2022.
The last time the country’s inflation rate moved the closest to the level was in 2001, when the average rate of inflation was 18.87 percent, according to Worlddata.info on inflation CPI by the International Monetary Fund (IMF) and the World Bank.
The NBS report said the latest inflation figure was higher by 2.27 percent points compared to 17.38 percent recorded in the corresponding period in July 2021, an indication that the country’s headline inflationary trend climbed higher in July 2022.
On a month-on-month basis, the NBS report showed the country’s headline inflation rate climbed by 1.817 percent during the month, higher than the 1.816 percent recorded in June 2022. The percentage change in the average composite CPI for the 12 months ending July 2022 over the average of the CPI for the previous 12 months period was 16.75 percent, an increase compared to 16.30 percent recorded in the corresponding period of July 2021.
The statistics agency said increases were recorded in all 12 Classification of Individual Consumption
by Purpose (COICOP) functions and all-items divisions used in calculating the headline inflation index.
The increase in inflation, the NBS said, was caused by an increase in food index attributed to the disruption in the supply of food products due the rising insecurity across the country, particularly in major staple food production centres.
Other factors attributed to the rising inflation included an increase in the cost of transportation as a result of the higher cost of energy, an increase in import costs due to currency depreciation as well as a general increase in the cost of production goods and services as a result of the impact of inflation on all factors of production.
“The composite food index on a year-on-year basis was 22.02 percent in July 2022, showing a rise compared to 21.03 percent in July 2021. The rise in the food index was caused by increases in prices of bread and cereals, food products, potatoes, yam, and other tubers, meat, fish, oil, and fat,” the NBS said.
On a month-on-month basis, the NBS report, showed that food sub-index in July 2022, which stood at 2.04 percent, was lower than the 2.05 percent recorded in June 2022.
The agency said the index for all items less farm produce (Core inflation), excluding prices of volatile agricultural produce, stood at 16.26 percent in July 2022 on a year-on-year basis, which was higher when compared to 13.72 percent recorded in July 2021.
On a month-on-month basis, the core sub-index was 1.75 percent in July 2022, higher when compared to 1.56 percent recorded in June 2022. The highest increases were recorded in prices of gas, liquid fuel, solid fuel, passenger transport by road, passenger transport by air, garments, cleaning, repair and hire of clothing.
On the urban and rural distribution of the inflation indices, the NBS report showed inflation rate on a year-on-year was 20.09 percent in July 2022, higher when compared to 18.01 percent reported in July 2021.
On a month-on-month basis, the urban inflation rate was 1.8209 percent in July 2022, a decrease compared to June 2022 with 1.8211 percent.
On the other hand, the rural inflation, which stood at 19.22 percent in July 2022 on a year-on-year basis, was higher compared to the 16.75 percent recorded in July 2021.
On a month-on-month basis, the rural inflation rate was 1.811 percent in July 2022, also higher than 1.809 percent in June 2022.
The review of the all items inflation rate for the 36 states and the Federal Capital Territory in July 2022 on a year-on-year basis showed that inflation was highest in Akwa Ibom (22.88 percent), followed by Ebonyi (22.51 percent), and Kogi (22.08 percent), while the slowest rise was recorded in Jigawa (16.62 percent), followed by Kaduna (17.04 percent), and Borno (18.04 percent).
On a month-on-month basis, July 2022 inflation rate recorded the highest increase in Adamawa (2.87 percent), followed by Abuja (2.84 percent), and Oyo (2.77 percent), while Bauchi recorded the slowest rise on month-on-month inflation (0.82 percent), followed by Kano (0.83 percent) and Niger (1.03 percent). Further review of the report showed that the food sub-index inflation for the states in July 2022 on a year-on-year basis was highest in Kwara with (29.28 percent), followed by Akwa Ibom (27.22 percent), and Kogi (26.08 percent), while Kaduna recorded the slowest rise on year-on-year food inflation (17.16 percent), followed by Jigawa (17.46 percent) and Anambra (19.25 percent).
On a month-on-month basis, the food inflation sub-index was highest in Kwara (3.90 percent), followed by Delta 3.61 (percent), and Benue (2.94 percent), while Taraba, Gombe, and Niger recorded the slowest rise on month-on-month inflation with 0.14 percent, 0.94 percent, and 1.13 percent respectively.

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