Business News
Nigeria’s inflation rose to 11.37% in April, after 3 months decline
The consumer price index, which measures inflation, rose to 11.37% in April 2019, according to the monthly inflation report released by @nigerianstat. The rise in April’s inflation rate represents the first time inflation increased in three months.
The consumer price index, which measures inflation, rose to 11.37% in April 2019, according to the monthly inflation report released by the National Bureau of Statistics (NBS).
According to the NBS report, year-on-year, inflation increased by 0.12% points higher than the 11.25% rate recorded in March 2019.
Also, month-on-month, the headline index increased by 0.94 percent in April 2019, representing a 0.15 percent rate higher than the rate recorded in March 2019.
Food and other items index rose: The composite food index rose by 13.70 percent in April, compared to the 13.45 percent recorded in the previous month. The NBS stated that the rise in the food index was caused by increases in prices of Meat, Fish, Oils/fats, Bread/Cereals, Fish, Milk, Cheese, egg, Potatoes, yam, and other tubers, Fruits and vegetables.
Similarly, food sub-index increased by 1.14 percent for the month under review, up by 0.26 percent points from 0.88 percent recorded in March. On the other hand, core inflation (all item less farm produce) dropped to 9.3 percent, down by 0.2% when compared with 9.5 percent recorded in March.
The Bureau provided further insight into items that recorded the highest increase in inflation, specifically, some of the items include Medical services, Hospital services, Dental Services, Tobacco, Vehicle spare parts, Major household appliances, etc.
States Inflation rose up in the north: In the month of April, northern states recorded the highest inflation on all items. The top three states with the highest inflation rate include Kebbi, Bauchi, and Zanfara. On the other hand, Abia, Delta, and Cross River recorded the slowest inflation rise in headline year on year inflation.
Similarly, food inflation data shows that Kaduna, Kebbi, and Kwara States recorded the highest rise inflation on year on year basis, While Rivers, Bayelsa, and Kogi States all recorded the slowest rise inflation.
Urban Inflation spikes: In the month of April, urban inflation rate increased to 11.70 percent year on year basis from 11.54 percent recorded in March. On the other hand, rural inflation increased to 11.08 percent, up from 10.99 percent in March.
Month on month basis, the urban index also rose by 1 percent faster than rural inflation. Specifically, urban inflation up by 0.19 from 0.81 percent recorded in March, while on the other hand rural inflation index rose by 0.9, up from 0.3 percent recorded in the previous month.
Optics: The rise in April’s inflation rate represents the first time inflation increased in three months. Note that inflation has dropped for three consecutive months, from 11.37 percent in December, to 11.25 percent in March 2019. However, the new inflation is just the same rate recorded in December (11.37%)
As inflation inches up after dropping for three months, it implies all affected items captured by the Bureau witnessed a quick rise in terms of prices. It is important to note that food price spikes tend to be more temporal which is mostly triggered by shortages in supply, in relation to demand.
The rise in inflation rate is against analysts’ predictions that there will a drop in inflation in the month of April. For instance, FSDH Merchant Bank Limited earlier forecasted that inflation rate is expected to drop for the fourth consecutive month in April. Meanwhile, the rise in inflation rate is consistent with Nairametrics earlier report that business owners expect inflation maintain double digit in the next one year.
Upshots: As stated earlier, the spike in inflation rate for April 2019, for instance, means a quick rise in prices. The rise in food index was caused by increases in prices of Meat, Fish, Oils/fats, Bread and Cereals, Fish, Milk, Cheese an egg, Potatoes, yam, and other tubers, Fruits and vegetables.
Hence, the spike in inflation implies that businesses revenue may slightly deplete as the purchasing power of consumers drops, while this may also worsen export and growth for the period under review. Just as the International Monetary Fund (IMF) warned that Nigeria must keep inflation down to maximize full potential.
Controlling inflation is seen as a healthy stimulus for the economy as a whole, but it can also be quite challenging to keep in check. Spike in inflation for the month suggests that small businesses should remain mindful of its effects.
Although, large organizations are generally better-positioned to bear the brunt of inflation, as it can be offset by savings generated through economies of scale. However, small firms, often take a direct hit on margin. A slight increase could hurt capital expenditure, increase the cost of production for goods and turnover of the company.
Read the full Bureau’s report here: NBS April 2019 Inflation Report
Business News
Job listings spike up by 183% in April –Jobberman
Jobberman released figures showing a 183% increase in job listings on its platform in April 2020, thanks to its #UnityInAdversity campaign.
Notable job placement website, Jobberman, has released figures showing that there was a 183% increase in job listings on its platform in the month of April 2020.
This increase, according to Jobberman, is a result of the #UnityInAdversity campaign which allowed companies to post job listings and access Jobberman’s database of over 2.2 million professionals across Nigeria for free, rather than paying the usual fees. This was the company’s way of showing support to businesses and individuals, amid the economic challenges which resulted from the COVID-19 pandemic.
According to the release from Jobberman, this campaign came at a cost to the company since it was trading off its revenue by offering for free, the same services which formed its major source of income.
“At the beginning of March, Jobberman Nigeria saw a 70 percent decrease in job listings due to the reduced economic activity caused by the enforced lockdown and many companies shutting down recruitment budgets to cut costs. Jobseeker sign-ups also decreased by 17 percent. Jobberman took the bold step to put employers’ and job seekers’ needs first” the statement read.
(READ MORE: Merger, Tax incentive boosts BUA Cement FY 2019 result)
The campaign, which is billed to run till June 30, has paid off greatly as data for April’s job listings alone was more than that of the entire Q1 2020 period. See a breakdown of the job listings below:
- Almost a fifth of the positions (18.79%) were listed in the tech sector
- Banking, finance, and insurance accounted for 9.27%
- Education and training had 6.78 percent
- IT & Software positions accounted for 11.69%
- Sales had 13.32%.
Note that with the increase in job listings, job seeker sign-ups also increased by 39% in April alone.
Speaking about the campaign, the CEO of Jobberman Nigeria, Hilda Kragha said, “The COVID-19 pandemic has made the process of connecting talent to opportunities more complicated and we are fully aware of the strain businesses and individuals in Nigeria are facing. We plan to be here for the next 10 years so making this small sacrifice to help our users navigate these difficult times is something that we think is definitely worth doing”.
Kragha also noted that the campaign has encouraged healthy competition as candidates strive to show themselves qualified for the position.
“We have found that soft skills such as emotional intelligence, business etiquette, time management, which are often overlooked and underestimated in Nigeria, can make a big difference. We know the power of soft skills and we are committed to empowering individuals with the training and soft skills they need to succeed in the workplace” she explained further.
(READ MORE: Partnerships Beyond The Partners… Another Lesson From Interswitch)
Sequel to this, the company also launched a free soft skills training programme to help job seekers (between age 18 and 30 years) acquire the needed soft skills and better their chances of gaining employment.
Economy & Politics
Gold prices rise, as President Trump decides on China today
Gold prices jumped on Friday as China and America’s drift deepened over further moves by China to impose security laws on Hong Kong
Gold prices jumped on Friday as China and America’s drift deepened over further moves by China to impose security laws on Hong Kong, lifting the allure of safe havens amid market uncertainties.
U.S. President Donald Trump’s top economic adviser cautioned the Chinese lately that Hong Kong, which has enjoyed special privileges, may now be treated like China when it comes to financial matters and trade.
Trump, who had earlier vowed a tough action on China, will hold a news conference today to announce what measures his administration will take.
Spot gold gained about 0.1% at $1,719.63 per ounce, and U.S. gold futures rose 0.4% to $1,734.60.
The friendship between the Americans and Chinese had weakened, since the outbreak of the Covid-19 pandemic.
President Trump and President Jinping of China have accused each other as a result of issues surrounding the COVID-19 pandemic.
(READ MORE: Gold records 3-week high, as investors rush to safe haven)
Why do Investors buy Gold? Global Investors most often buy the safe-haven asset in times of uncertainty and use it to hedge against cash (inflationary macros).
“The possible U.S. response could range from a tearing up of the Phase 1 trade deal and fresh tariffs on China, to milder travel or financial sanctions on Chinese officials,” said Shane Oliver, chief economist at Australian wealth manager AMP to Reuters News.
“It is seen as a major threat to the rally we’ve had and the recovery,” “If it’s at the relatively mild end, then I don’t think it would derail the recovery bull market, but if it’s at the more extreme end with tariffs and harsh treatment of Hong Kong, then I think it gets more problematic,” Oliver added.
Business News
AfDB board denies asking Adesina to step down, as Obasanjo says the bank risks being hijacked
“The Bureau of the board of governors informs the public that it has not taken any decision. Everyone must allow the Bureau to do its work and allow due process to reign.”
The Bureau of the Board of Governors of the African Development Bank (AfDB) has denied media reports making the rounds that AfDB’s president, Akinwumi Adesina, has been asked to step down pending the completion of the probe and determination of allegations against him.
The bank’s top governing board members said that they have not asked Adesina to step down from his position as president, even as the board continues to review the fallout of complaints by some whistleblower. The statement from the Chairman of the bank’s board of governors, Niale Kaba, said:
“The Bureau of the board of governors informs the public that it has not taken any decision. Everyone must allow the Bureau to do its work and allow due process to reign. All governors will be carried along in resolving the issue.’’
READ ALSO: IMF advises banks to suspend dividend payment
Kaba also stressed that there was no governance crisis at AfDB as was being speculated in certain quarters. He confirmed that the Bureau of the Board of Governors of AfDB met on Tuesday, May 26, after the request by the U.S Secretary calling for an independent probe. The essence of the meeting was to take a closer look at the allegations by the whistleblowers against Akinwumi Adesina, said allegations which had already been investigated by the ethics committee of the bank.
Kaba further disclosed that even though no decision has been taken yet, the bureau assures that it is treating the case with the utmost seriousness that it deserves.
(READ MORE: AfDB bows to pressure from U.S, orders an independent probe of Akinwumi Adesina)
Adesina, who maintains his innocence of those allegations, had stated that a fair, transparent, and just process will vindicate him.
In a related development, former Nigerian President Olusegun Obasanjo had thrown his weight behind Adesina and kicked against the demand by the United States of America for a fresh, independent probe of the AfDB President who had earlier been cleared by the ethics committee of the bank.
In his letter to 12 former African Presidents, Obasanjo said that Africa must stand up and not allow its institutions to be unduly controlled by non-African countries.
Obasanjo said that the bank has witnessed tremendous growth under Adesina’s leadership and has doubled its capital base since he took over.
