Nigeria’s inflation rate reduces again

The National Bureau of Statistics (NBS) has released Nigeria’s inflation rate for the month of March 2019. According to the data released, inflation fell 0.06 percent to 11.25 percent in March from 11.31 percent in February 2019.  

Food inflation, which is derived from the Food composite index, increased to 13.45 percent from 13.47 percent recorded in February 2019. The rise in the index was caused by increases in prices of Bread and cereals, Meat, Fish, Potatoes, Yam and other tubers, Oils and fats, and Soft drinks, Vegetables, and Fruits.  

The Core inflation or  ”all items less farm produce” which excludes the prices of volatile agricultural produce stood at 9.5 percent in February 2019 down by 0.3 percent when compared with 9.8 percent recorded in February 2019. According to the report, the highest increases were recorded in the prices of  prices of Domestic and household services, Tobacco, Actual and imputed rent for housing, Dental, Medical and Hospital services, Tobacco, Major household appliances.

How states fared

At the state level, the highest inflation rates in March 2019 were recorded Kebbi (14.65 percent), Zamfara (13.15 percent) and Taraba (12.98 percent), while Kwara (9.84 percent) Cross River (9.66 percent) and Delta (9.61 percent) recorded the slowest rise in headline Year on Year inflation.

On a month on month basis, the highest inflation rates recorded in March 2019 were in  Kogi (1.91 percent), Plateau(1.77 percent), and Lagos (1.63 percent), while Nasarawa (0.26 percent), Kwara (0.16 percent) and Enugu (0.13 percent) recorded the slowest rise.

During the same period, food inflation on a year on year basis was highest in  in Kebbi (16.35 percent), Niger (16.22 percent) and Kwara (15.95 percent), while Bauchi (11.82 percent), Delta (11.70 percent) and Ogun (11.55 percent) recorded the slowest rise. On month on month basis however, March 2019 food inflation was highest in Kogi (2.97 percent), Lagos and Plateau (2.11 percent) and Oyo (2.04 percent), while Imo and Nasarawa (0.12 percent), Enugu (0.11 percent) recorded the slowest rise with Bayelsa recording food price deflation or negative inflation.

What this means

The decrease in March inflation by 0.06 percent is insignificant because it has no effect on the lives of Nigerians. However, inflation rate is expected to increase over the next three months due to the Easter and the Ramadan celebrations as well as the implementation of the minimum wage. The Central Bank of Nigeria (CBN) during its Monetary Policy Committee (MPC) meeting which took place last month also projected that inflation would increase to 12 percent before moderating.