Nigeria’s Headline Inflation Climbs to 28.92%

Nigeria’s Headline Inflation Climbs to 28.92%

Nigeria’s headline inflation grew stronger by 72 basis points to 28.92% year on year in December 2023, according to a statistics office report. In November, the consumer price index was 28.20% following a surge in food prices. Price level worsened over the last 12-month period, analysts said in a chat.

Current inflation data shows that the outturn recorded for December is 90 and 32 basis points higher than Cordros Capital Limited’s 28.02% and Bloomberg’s median consensus of 28.60%  estimates, respectively.

Similarly, on a month-on-month basis, headline inflation rose by 20bps to 2.29% versus 2.09% posted in November 2023. Food inflation maintained its uptrend in December, rising by 109bps to 33.93% year on year from 32.84% in November.

Notably, the pressure was most significant in the prices of bread and cereals, oil and fat, potatoes, yam and other tubers, fish, meat, fruit, milk, cheese, and eggs. On a month-on-month basis, food inflation increased to 2.72%, relative to the 2.42% m/m print recorded in the previous month.  Naira Rises by 19% as Forex Market Pressures Ease

Similarly, the core inflation (All items less farm produce and energy) rose by 68bps to 23.0% from 22.38%. The highest increases were recorded in prices of Passenger Transport by Road, Medical Services, Actual and Imputed Rentals for Housing.

Others are Passenger Transport by Air, Pharmaceutical products, Accommodation services, etc. Sequentially, the core index increased by 29bps to 1.82% month on month in December 2023 compared to the previous month.

The latest monthly inflation data published by the National Bureau of Statistics indicates that Nigeria’s inflation has been steadily increasing for twelve consecutive months, reaching 28.92% in December 2023.

This marks a continuation of the upward trend from 28.20% in November and brings the annual average to 24.52%, aligning with expectations for a gradual acceleration.

The current inflation rate in December 2023 represents a nearly 28-year high, approaching the 29.51% recorded in July 1996. This persistent surge remains above the Central Bank of Nigeria’s target range of 6% to 9%, driven by anticipated price hikes following the removal of premium motor spirit (PMS) subsidies.