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HomeTop NewsNigeria's Headline Inflation Accelerates to 22.79% in June, lower that Analyst Projections

Nigeria’s Headline Inflation Accelerates to 22.79% in June, lower that Analyst Projections

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By Samuel Bankole

Nigeria’s headline inflation rate experienced a notable increase in June 2023, reaching 22.79 percent, as revealed by the latest data released by the National Bureau of Statistics (NBS) on Monday.

This figure represents a 0.38 percent rise from the previous month’s rate of 22.41 percent. The NBS report also highlighted that, on a year-on-year basis, the headline inflation rate in June 2023 was 4.19 percent higher compared to the same period in 2022, which recorded a rate of 18.60 percent.

The month-on-month analysis indicates that the headline inflation rate rose by 2.13 percent in June 2023, surpassing the rate of 1.94 percent observed in May 2023. This signifies that the general price level increased by an average of 0.19 percent in June compared to the preceding month.

When examining the inflation rates based on urban and rural areas, the data reveals that the urban inflation rate in June 2023 stood at 24.33 percent, exhibiting a significant 5.23 percent increase from June 2022’s rate of 19.09 percent.

Similarly, the rural inflation rate experienced a year-on-year rise of 3.25 percent, reaching 21.37 percent in June 2023 compared to the previous year’s rate of 18.13 percent.

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Food inflation, a key factor contributing to the overall inflationary pressures, surged to 25.25 percent on a year-on-year basis in June 2023. This indicates a 4.65 percent increase from June 2022’s rate of 20.60 percent.

Notably, the spike in food prices was driven by hikes in the cost of oil and fat, bread and cereals, fish, potatoes, yam, fruits, meat, vegetables, milk, cheese, and eggs. On a month-on-month basis, the food inflation rate reached 2.40 percent in June 2023, slightly higher than May 2023’s rate of 2.19 percent.

Economic experts attribute the surge in inflation to the combined effects of escalating food and energy costs, coupled with currency depreciation.

However, it is worth noting that the reported inflation figure for June is lower than the projections made by several analysts, who anticipated a 24 percent inflation rate for the month.

Despite the challenging inflationary environment, analysts remain optimistic about the Nigerian government’s ongoing fiscal and monetary reforms. These measures are expected to gradually mitigate the cost of living in the foreseeable future, with the economy projected to gain robust traction in the medium to long term.

The inflationary trend in Nigeria has been on an upward trajectory, with consecutive increases recorded in recent months. Starting from February 2023’s rate of 21.9 percent, the inflation rate climbed to 22.04 percent in March, 22.22 percent in April, and 22.41 percent in May 2023.

(omayowa@globalfinancialdigest.com; Newsroom: +234 8033 964 138)

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