Nigeria’s inflation rises 12.56% in June for 10th consecutive month ~NBS
Nigeria consumer inflation rose 12.56 percent in June for the tenth consecutive month from 12.40 percent in the previous month, the National Bureau of Statistics (NBS) said in its latest report.
The increase in the inflationary figure exceeded all projections by analysts who have expected lower than the published figure increase in the consumer index.
The rise in inflation may not be unconnected with the disruption in supply chain and economic activities during the period of lockdown imposed by the government in an attempt to contain the spread of coronavirus pandemic.
Food inflation and costs of medical supplies contributed the highest to the June inflation figure as families consume more food and needed drugs to stay alive in the face of the lockdown and the ravaging pandemic.
Prices of food were reported went up as many farmers were not able to go to their farms while suppliers experienced difficulty in transporting farm produce to the market as a result of the ban on interstate travel by the government.
The food inflation rate rose from 15.18 percent year-on-year in June to 15.04 percent in May while food inflation month-on-month rose to 1.48 percent to 1.42 percent in May.
“We believe that the sustained shortfall in domestic food supply relative to the demand, as farmers are yet to embark on full harvest of their farm produce, coupled with continued closure of land borders, fueled the increases in food prices during the period,” analysts at United Capital wrote on Friday.
According to the analysts, the inflationary trend will continue to rise in the coming months while food inflation could temper as the gradual easing of activities across country improve the supply mechanism.
“For the month of July-2020, we expect pressure on the headline inflation rate be sustained, despite some positive developments during the month. For Food inflation, we expect the recently lifted ban on interstate movement to help ease the previous supply chain pressures.
“However, downside risk remains the closure of borders, reducing supply of food from foreign sources despite deficits in local production,” United Capital wrote in a note to clients.