Inflation rate in Nigeria dropped further in July to 11.14 percent from 11.23 percent in June, the lowest since January 2016. The inflation rate has been going down since reaching more than a 12-year high of 18.7 percent in January 2017.
According to the CPI and Inflation Report July 2018 released on Wednesday morning by the National Bureau of Statistics (NBS), increases were recorded in all COICOP (Classification of individual consumption by purpose) divisions that yielded the Headline index.
“On month-on-month basis, the Headline index increased by 1.13 percent in July 2018, down by 0.11 percent points from the rate recorded in June 2018 (1.24 percent). This represents the first-time month on month headline inflation has declined since February 2018,” the report said.
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) had in July kept the bank’s key rate unchanged at 14 percent for the 12th consecutive time, a tight monetary policy stance which has continued to ease inflationary pressures.
Urban inflation also eased by 11.66 percent y-o-y in July from 11.68 percent recorded in June, while the rural inflation rate remained flat at 10.83 percent in July from 10.83 percent in June.
Food inflation has also continued to ease, with cost of food increasing by 12.85 percent in July, compared to 12.98 percent in June. “This represents the tenth consecutive decline in year on year food inflation since September 2017,” the NBS report noted.
“This rise in the food index was caused by increases in prices of Potatoes, yam and other tubers, Vegetables, Bread and cereals, Fish, Oils and Fat and Fruits.”
The food sub-index increased by 1.40 percent month-on-month in July 2018, down by 0.17 percent
points from 1.57 percent recorded in June. This represents the first-time month on month food inflation has declined since February 2018.
Core inflation (all items less farm produce), which excludes the prices of volatile agricultural produce
stood at 10.2 percent in July, down by 0.2 percent from the 10.4 percent recorded in June, the 16th consecutive decline in year on year core inflation since March 2017.
The NBS noted that the highest increases were, however, recorded in prices of medical services, carpets and other floor coverings, vehicle spare parts, domestic services and household services, pharmaceutical products, paramedical services, hairdressing saloons and personal grooming establishment, dental services, motor cars and fuels and lubricants for personal transport equipment.
Also published on Medium.