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May 27, 2024

Nigeria’s Inflation Hits 33.69% 

Nigeria’s headline inflation in April 2024 increased to 33.69% up from the 33.20% recorded in March 2024, the National Bureau of Statistics has revealed.

The average cost of imported food products in Nigeria has increased to its highest level, reaching 34% in the year from April 2023 to April 2024 .

This is a 200 basis point increase from the 32% recorded in March 2024, according to the National Bureau of Statistics’ Consumer Price Index study .

 The Federal Government had prohibited food imports as part of its efforts to address the country’s high food costs and economic hardship . However, the country’s reliance on food imports has grown as a result of internal and external issues such as global supply chain disruptions following the Covid-19 pandemic and the Russia-Ukraine war, a rise in global oil prices, FX scarcity and subsequent depreciation of the local currency .

Nigeria’s inflation rate increased for the 16th consecutive month in April, driven by a threefold increase in electricity prices and increased transportation costs . This represents a 0.49% month-over-month gain in the headline inflation rate, which is lower than the median prediction of eight economists in a Bloomberg survey of 34.2% .

 The inflation rate in April 2024 was 11.47 percentage points higher than in April 2023, when it was 22.22% . This shows that the headline inflation rate has increased significantly over the previous year.

A Financial Derivatives report, on the other hand, noted that the national data’s findings did not account for petrol scarcity. The effect will be captured in next month’s reading. The acceleration raises the possibility of another interest rate increase when the central bank’s monetary policy committee meets next week. It has already increased borrowing costs to a record high in order to curb price growth and boost the naira. 

Core inflation, which excludes farm produce and energy costs, increased from 25.9% to 26.8% and food price growth accelerated from 40% to 40.5% in April . Moreover, the inflation rate for April 2024 was 2.29%, which is 0.73% lower than the 3.02% reported in March 2024 . This shows that the rate of price increase in April 2024 was slower than the rate in March 2024.

The April 2024 headline inflation rate showed a 0.49% point increase over the March 2024 headline inflation rate when looking at the movement . 

The headline inflation rate increased by 11.47% points year over year compared to the 22.22% rate recorded in April 2023.

This shows that the headline inflation rate increased in April 2024 compared to the same month the previous year, i.e., April 2023. Ondo, Osun, and Akwa-Ibom food inflation were 45.87%, 45.62%, and 45.09%, respectively . 

The states’ overall inflation rates were 38.12%, 37.17%, and 36.03%, respectively . However, in Edo State, the cost of food and services increased as a result of a 44.59% food inflation and a 32.72% increase in all items inflation . Abia and Rivers’ overall inflation rates surpassed 35%, driven primarily by food price increases against an average food inflation rate of 44.53% . Oyo also experienced a substantial increase in food inflation to 43.53%, while Ebonyi state joined the list with inflation rates exceeding 39.18% . 

The report noted that Lagos state experienced the greatest increase in food and all items inflation, with 4.74% and 4.52%, respectively ¹.

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