Nigeria’s inflation drops to 21.34% in December

By Onome Amuge

Nigeria’s inflation rate fell for the first time in 11 months to 21.34 per cent , a significant decrease of 0.13 per cent compared to 21.47  per cent recorded in the previous month of November 2022, according to the latest  Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) .

 The headline inflation rate however stood   5.72 percentage  points higher year-on-year against 15.63 per cent recorded in December 2021, indicating an annual increase  when compared to the same month in the preceding year  of December 2021.

The report which measured the rate of changes in prices of goods and services,further showed that  the percentage change in the All Items Index in December 2022 was 1.71 per cent, which was 0.32 per cent  above 1.39 per cent recorded in November 2022.

This, according to the national statistics agency, indicates that in the month of December 2022, the general price level was 0.32 per cent higher relative to November 2022.

Also, the percentage change in the average CPI for the twelve months ending December 2022 over the average of the CPI for the previous twelve months period was 18.85 per cent, indicating 1.89 per cent increase compared to the 16.95 per cent recorded in December 2021.

According to the NBS, the increases were recorded in all COICOP divisions that yielded the headline index most especially in food & non-Alcoholic beverages, transport and miscellaneous goods & services.

The report attributed likely factors responsible to increase in inflation rate in month-on-month to the sharp increase in demand usually experience during the festive season, increase in the cost of production and services including energy cost, transportation cost, exchange rate depreciation etc

The food inflation rate in December 2022 was 23.75% on a year-on-year basis, 6.38 per cent higher compared to the 17.37 per cent recorded in December 2021.

The rise in the food inflation was attributed to increases in prices of Bread and cereals, Oil and fat, Potatoes, Yam and other tubers, fish, and other food products.

On a month-on-month basis, the food inflation rate in December was 1.89 per cent, 0.49 per cent higher compared to the 1.40 per cent recorded in November 2022. The report attributed the increase to a rise  in prices of some food items like oil and fat, fish, potatoes & tubers, bread & cereals, and fruits. Also on the rise was the average annual rate of food inflation for the twelve-months ending December 2022 over the previous twelve-month average which stood at 20.94 per cent, 0.53 percentage points increase above the 20.40 per cent average annual rate of change recorded in December 2021.

Meanwhile, the “All items less farm produce’’ index or Core inflation, which excludes the prices of volatile agricultural produce, stood at 18.49 per cent in December 2022 on a year-on-year basis. The figure indicated a 4.62 per cent surge when compared to the 13.87 per cent  recorded in December 2021.

On a month-on-month basis, the core inflation rate declined at 1.33 per cent in December 2022,down by 0.34 per cent from 1.67 per cent in November 202 .

Notably, the highest increases were recorded in prices of gas, liquid fuel, passenger transport by air, vehicle spare parts, fuels and lubricants for personal transport equipment, solid fuel etc.

Also on the rise was the average twelve-months annual inflation rate which stood at 16.08 per cent for the twelve-months ending December 2022,2.91 percentage points higher than the 13.16 per cent recorded in December 2021.

The urban inflation rate for December 2022 was 22.01 per cent, which was 5.85 per cent higher compared to the 16.17 per cent recorded in the corresponding period of December 2021. On a month-on-month basis, the urban inflation rate was 1.80 per cent in December 2022, which was 0.31 per cent higher compared to 1.50 per cent recorded in November 2022.

The report further showed that the corresponding twelve-month average for the urban inflation rate was 19.38 per cent in December 2022, 1.86 per cent higher compared to the 17.52 per cent reported in December 2021.

On the other hand, the rural inflation rate in December 2022 was 20.72 per cent on a year-on-year basis, 5.61 per cent above the 15.11 per cent recorded in December 2021. On a month-on-month basis, the rural inflation rate in December 2022 was 1.63 per cent, rising 0.33 per cent against 1.30 per cent for November 2022 . The corresponding twelve-months average for the rural inflation rate in December 2022 stood at 18.34 per cent, 1.94 per cent above the 16.40 per cent  recorded in December 2021.