Inflation Rate Accelerates Further to 33.95% in Nigeria

Inflation rate accelerated by 26 basis points in May to 33.95% due to higher food items prices in Nigeria amidst uncertainties, according to data released by statistics office. In its report, the National Bureau of Statistics (NBS) said that in May 2024, the headline inflation rate increased to 33.95% from 33.69% in April.

Broadstreet analysts have maintained that consumer price index would rise throughout the first half of 2024 before base effect is expected to cause price levels to recalibrate in the second half of the year.

“Looking at the movement, the May 2024 headline inflation rate showed an increase of 0.26% points when compared to the April 2024 headline inflation rate”, statistics office stated in the report.

On a year-on-year basis, the headline inflation rate was 11.54% points higher compared to the rate recorded in May 2023, which was 22.41%. This shows that the headline inflation rate (year-on-year basis) increased in the month of May 2024 when compared to the same month in the preceding year.

On the contrary, on a month-on-month basis, the headline inflation rate in May 2024 was 2.14%, which was 0.15% lower than the rate recorded in April 2024 with a reading of 2.29%.

NBS said this means that in the month of May 2024, the rate of increase in the average price level is less than the rate of increase in the average price level in April 2024.

The percentage change in the average CPI for the twelve months ending May 2024 over the average of the CPI for the previous twelve-month period was 29.06%, showing a 7.86% increase compared to 21.20% recorded in May 2023.

URBAN INFLATION

On a year-on-year basis, in the month of May 2024, the urban inflation rate was 36.34%, this was 12.61% points higher compared to the 23.74% recorded in May 2023. On a month-on-month basis, the urban inflation rate was 2.35% in May 2024, this was 0.32% points lower compared to April 2024 (2.67%).

The corresponding twelve-month average for the urban inflation rate was 31.07% in May 2024. This was 9.12% points higher compared to the 21.95% reported in May 2023.

RURAL INFLATION

The rural inflation rate in May 2024 was 31.82% on a year-on-year basis; according to NBS. This was 10.63% higher compared to the 21.19% recorded in May 2023.

On a month-on-month basis, the rural inflation rate in May 2024 was 1.94%, up by 0.02% points compared to April 2024 (1.92%). The corresponding twelve-month average for the rural inflation rate in May 2024 was 27.27%. This was 6.76% higher compared to the 20.50% recorded in May 2023.

The food inflation rate in May 2024 was 40.66% on a year-on-year basis, which was 15.84% points higher compared to 24.82% recorded in May 2023. The rise in food inflation on a year-on-year basis was caused by increases in the prices of Semovita, Oatflake, Yam flour prepackage, Garri, beans, etc.

Other items that saw price surge include Irish Potatoes, Yam, Water Yam, Palm Oil, Vegetable Oil, Stockfish, Mudfish, Crayfish, etc (under Fish class), Beef Head, Chicken-live, Pork Head, and Bush Meat. Like the month-on-month headline inflation, the month-on-month Food inflation rate in May 2024 was 2.28%, which also shows a decrease of 0.22% compared to 2.50% recorded in April 2024.

The fall in food inflation on a monthly comparison basis was caused by a fall in the rate of increase in the average prices of Palm oil and Oil. Others are Yam, Irish Potatoe, Cassava Tuber (under Potatoes, Yam & Other Tubers Class), Wine, Bournvita, Milo, Nescafe (under Coffee, Tea and Coco Class)

The average annual rate of food inflation for the twelve months ending May 2024 over the previous twelve-month average was 34.06%, which was 10.41% points increase from the average annual rate of change recorded in May 2023 (23.65%). #Inflation Rate Accelerates Further to 33.95% in Nigeria Reforms: Fitch Revises Nigeria’s Outlook to Positive
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