Nigeria’s Inflation Skyrockets in August, With Food Prices Leading the Charge

Nigeria’s Inflation Skyrockets in August, With Food Prices Leading the Charge – The latest data from the National Bureau of Statistics (NBS) paints a concerning picture for the economy. August saw the inflation rate surge to an alarming 25.80%, a notable jump from July’s 24.08%.

The NBS’s recently released Consumer Price Index for August 2023 offers a deeper insight. The headline inflation for August 2023 rose by 1.72 percentage points from July. To put this into perspective, the inflation rate in August 2022 was 20.52%. This means there’s been a 5.27% increase year-on-year.

But what’s driving this increase?

The primary culprit appears to be food. The year-on-year food inflation rate for August 2023 stood at a staggering 29.34%. That’s a 6.22% increase from August 2022, which saw a rate of 23.12%. Delving into specifics, the NBS attributes this rise to surging prices in various food items including oil, fats, bread, cereals, fish, fruits, meat, vegetables, potatoes, yam, tubers, milk, cheese, and eggs. And it’s not just the yearly figures that are concerning. Even on a month-to-month basis, food inflation in August 2023 was recorded at 3.87%, up by 0.41% from July 2023’s 3.45%. The key contributors to this monthly hike were items like bread, cereals, potatoes, yam, tubers, fish, oil, fats, coffee, tea, and cocoa.

To give you a broader view, the average annual food inflation rate for the year leading up to August 2023 was 25.01%. This is an increase of 5.99% from the annual rate recorded in August 2022, which was 19.02%.

What do the experts say?

Analysts from Cordros Research weighed in on the situation. They forecast that the pressures on non-food inflation are likely to persist. With worsening currency pressures and unchanged FX demand-supply dynamics in both official and unofficial markets, the non-food inflation is predicted to reach 2.24% month-on-month. Taking all these factors into account, Cordros Research projects that September’s headline inflation might climb by 2.47% month-on-month, potentially reaching a year-on-year rate of 27.18%.

In these trying times, it’s crucial for consumers to be informed and prepared. With inflation rates on the rise, especially in the food sector, it’s essential to make informed financial and purchasing decisions.