Nigeria inflation rate reaches new peak at 31.70% in February – NBS

Business a.m.

Nigeria experienced an unprecedented spike in inflation, with a new all-time high of 31.70 per cent recorded in February 2024, an indication that prices of goods and services in Nigeria have increased significantly over the past year, placing further strain on consumers,according to the National Bureau of Statistics (NBS).

The NBS in its latest Consumer Price Index and Inflation Report, indicated  that inflation in Nigeria increased by 1.80 percentage points between January and February 2024. 

The year-on-year comparison of the headline inflation rate for February 2024 with the same month in the previous year, February 2023, showed a substantial increase. The rate for February 2024 was 31.70 per cent, whereas the rate for February 2023 was 21.91 per cent. 

In addition to the year-on-year comparison, the NBS report also examined the month-on-month changes in inflation. The month-on-month inflation rate for February 2024 was 3.12 per cent, representing a 0.48 per cent increase from the rate recorded in January 2024. 

On an even broader time scale, the NBS report analysed the average inflation rate over the past twelve months, up until February 2024. The percentage change in the average CPI for the twelve-month period was 26.18 per cen, compared to the average CPI for the previous twelve-month period. This represents a significant 6.31 per cent increase in inflation, highlighting the longer-term trend of rising prices in Nigeria.

Breaking down the inflation figures further, the report found that urban areas in Nigeria were particularly impacted by rising prices. The year-on-year inflation rate in urban areas reached 33.66 per cent in February 2024, up from 22.78 per cent in the previous year. This represents a 10.87 per cent increase, which is much higher than the increase in rural areas.  For February 2024, the twelve-month average urban inflation rate was 27.93 per cent, an increase of 7.48 per cent from the previous year. 

In addition to urban areas, the report examined inflation rates in rural areas, which also experienced an increase in prices over the past year. The rural inflation rate stood at 29.99 per cent on a year-on-year basis, up from 21.10 per cent in the previous year. This represents a significant 8.89 per cent increase, which is slightly higher than the increase in urban areas. On a month-on-month basis, the rural inflation rate also increased by 3.07 per cent, up from 2.57 per cent in January 2024.

Breaking down the overall inflation data further, the report focused on the food inflation rate, which saw a particularly sharp increase. The food inflation rate was 37.92 per cent in February 2024, a staggering 13.57 percentage points higher than the previous year.

The rise in Food inflation on a year-on-year basis was attributed to increases in prices of bread and cereals, potatoes, yam and other tubers, fish, oil and fat, meat, fruit, coffee, tea, and cocoa.

In addition to the year-on-year changes, the report also examined the month-on-month changes in food inflation. The food inflation rate in February 2024 was 3.79 per cent higher than in January 2024, highlighting the continuation of the upward trend in food prices.  The month-on-month increase was driven by a rise in the rate of increase in the average prices of bread and cereals, potatoes, yam & other tubers, fish, coffee, tea, and cocoa.

The average annual rate of food inflation for the year ending February 2024 is another important measure to consider, the report showed. This rate of 30.07 per cent was significantly higher than the average annual rate of 22.12 per cent for the previous year, highlighting the significant impact of food inflation over the past year. 

The Core inflation rate, which excludes volatile agricultural products and energy, reached 25.13 per cent in February 2024. This represented a significant increase of 6.76% when compared to the same month in the previous year. The highest increases in price were seen in a number of specific categories, including passenger transport by road, actual and imputed rentals for housing, medical services,pharmaceutical products etc. 

On a month-to-month basis, the core Inflation rate for February 2024 was 2.17 per cent, a slight decrease of 0.07% from the previous month. This indicates a marginal slowdown in the rate of price increases. However, it is important to note that the twelve-month average annual inflation rate, which takes into account the changes over the past year, was much higher at 21.72 per cent.