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July 19, 2024

Inflation Hits 18-Year High at 24.08% as Nigerians Grapple With High Cost of Food 

Nigeria’s Bureau of Statistics said the annual inflation rate in Nigeria reached 24.08% in July, marking the highest level in 18 years. 

This surge in inflation can be attributed to the rising prices of food items and increased transportation costs. 

As a result, households are facing greater challenges in meeting their daily food requirements, which is further exacerbated by the removal of fuel subsidies and the continued depreciation of the local currency.

The inflation rate has increased by 1.29 percentage points compared to June’s rate of 22.79%. This rise can be primarily attributed to the escalating prices of essential food items such as oil, fat, bread, cereals, fish, potatoes, yam, fruits, meat, vegetables, milk, cheese, and eggs.

Due to this, there has been a significant increase in food inflation, reaching a record high of 26.98 percent, the highest level seen in the past 18 years since September 2005.

Furthermore, the removal of fuel subsidies has also had a notable impact on the cost of transportation and related services, leading to a rise in core inflation. 

In July, core inflation (which excludes farm produce and energy) reached 20.47 percent, marking the highest level in the past 19 years. 

This represents a 0.41 percentage point increase from the previous month’s rate of 20.06 percent in June.

According to the National Bureau of Statistics, in its Consumer Price Index report for August, the increase in prices of food and non-alcoholic beverages accounted for the majority (12.47 percent) of the rise in the headline inflation rate to 24.08 percent in July. This was followed by increases in housing water, electricity, gas & other fuel (4.03 percent); clothing and footwear (1.84 percent); transport (1.57 percent); and furnishings, household equipment and maintenance (1.21 percent).

The NBS further stated that the headline inflation rate in July 2023 rose to 24.08 percent compared to the June 2023 headline inflation rate, which stood at 22.79 percent.

“Looking at the movement, the July 2023 headline inflation rate showed an increase of 1.29% points when compared to the June 2023 headline inflation rate.

“On a year-on-year basis, the headline inflation rate was 4.44% points higher compared to the rate recorded in July 2022, which was 19.64%. This shows that the headline inflation rate (year -on-year basis) increased in July 2023 when compared to the same month in the preceding year (i.e., July 2022).

“In addition, on a month-on-month basis, the headline inflation rate in July 2023 was 2.89%, which was 0.76% higher than the rate recorded in June 2023 (2.13%). This means that in July 2023, on average, the general price level was 0.76% higher relative to June 2023,” NBS reported.

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