Nigeria has recorded its tenth straight rise in the inflation rate of foodstuffs to a new high of 27.33% for the month of October, as analysts predict further climbs in the months ahead.
The current statistic reflects a 0.61 percentage point year-on-year (YoY) increase over the September figure of 26.72%.
The National Bureau of Statistics (NBS), reported yesterday that the food index grew year on year to 31.52% from 30.64% in its Consumer Price Index (CPI), report for October.
The increase in food inflation was caused by price rises in bread and cereals, oil and fat, potatoes, yam and other tubers, fish, fruit, meat, vegetables, milk, cheese, and eggs, according to the National Bureau of Statistics.
NBS said, “In October 2023, the headline inflation rate increased to 27.33% relative to the September 2023 headline inflation rate, which was 26.72%.
“Looking at the movement, the October 2023 headline inflation rate showed an increase of 0.61 percentage points when compared to the September 2023 headline inflation rate.
However, the month-on-month (MoM) inflation rate fell by 0.37 percentage points to 1.73 percent in October from 2.1 percent in September.
On food inflation, NBS stated: “The rise in food inflation on a YoY basis was caused by increases in prices of bread and cereals, oil and fat, potatoes, yam and other tubers, fish, fruit, meat, vegetables, milk, cheese, and eggs.
“On a month-on-month basis, the food inflation rate in October 2023 was 1.91 percent; this was 0.54 percentage points lower compared to the rate recorded in September 2023 (2.45 percent)”.
According to NBS, food inflation was highest in Kogi (41.74 percent), Kwara (38.48 percent), and Lagos (37.37 percent), with Borno (24.41 percent), Kebbi (24.90 percent), and Jigawa (25.10 percent) recording the slowest increases.
Meanwhile, in an interview with journalists in Abuja on the latest NBS figures, Dr. Isa AbdulMumin, spokesman for the Central Bank of Nigeria (CBN), expressed optimism that the low rate of increase in the average price level in October compared to September 2023 was an indication that the bank’s monetary policy stance to tighten rates and its money market reforms were having the desired effect.
Despite a 0.61% increase in headline inflation, Isa remained confident that the Central Bank of Nigeria (CBN) was on the right track towards maintaining price stability.
According to him, available figures showed that the first signal of price deceleration was recorded in September and that subsequent money market reforms, which began in October, had hastened prices, as seen by the significant decline in month-on-month changes recorded in October.
“Moderation in month-on-month changes in prices observed in the headline, food, and core components of the consumer basket followed reforms in the money market and relative stability in the FX market,” he added.
However, analysts seem to have disagreed with the apex bank, hinting that the inflationary pressure would continue much longer in the months ahead.
According to Ayorinde Akinloye, an economic and investment strategist, inflationary pressures will continue this year (2023), with stabilization expected in 2024.
Akinleye said: “Several inflationary pressure points remain in the economy. The impact of the recent pressure on the currency is yet to filter through to prices and will be a major inflation driver in the next few months.”
He went on to say that “considering we are in the harvest season, we may likely see food prices rise at a slower rate than we have experienced in 2023.”
“Overall, I still expect to see inflation sustain the uptrend through 2023, with any form of stability more likely in 2024 and primarily supported by base effects,” he added.
