Nigeria’s inflation rate rose by 14.23% (year-on-year) in October 2020 as against 13.71% recorded in September 2020. This was contained in the consumer price index report, recently released by the National Bureau of Statistics (NBS).
According to the report, the October figures indicates a persistent increase in 14 months and the highest recorded since March 2018. Also, on a month-on-month basis, the Headline index increased by 1.54% in October 2020, this is 0.06% rate higher than the rate recorded in September 2020 (1.48%).
READ: Nigeria’s inflation rate jumps to 12.82%, highest in 27 months
Food inflation
The composite food index, a closely watched component rose by 17.38% in October 2020 compared to 16.66% recorded in September 2020. On month-on-month basis, the food sub-index increased by 1.96% in October 2020, up by 0.08% points from 1.88% recorded in September 2020.
The major drivers of food inflation were increases recorded in the prices of Bread and cereals, Potatoes, Yam and other tubers, Meat, Fish, Fruits, Vegetable, alcoholic and food beverages and Oils and Fats.
READ: A summer of higher food prices, limited room for monetary policy
Core inflation
The “All items less farm produce” or Core inflation, which excludes the prices of volatile agricultural produce stood at 11.14% in October 2020, up by 0.56% when compared with 10.58% recorded in September 2020.
The highest increases were recorded in prices of Passenger transport by air, Hospital and Medical services, Passenger transport by road, Pharmaceutical products, Motor cars, Vehicle spare parts, maintenance and repair of personal transport equipment, Hairdressing salons and personal grooming establishments, Miscellaneous services relating to the dwelling, Paramedical services and shoes and other footwear.
READ: FG seeking approval from National Assembly for $1.2 billion agric loan
States with highest inflation
Zamfara State recorded the highest rate in the month of October with a 17.69% increase (year-on-year), followed by Sokoto State (17%), Ebonyi (16.91%), Bauchi (16.73%), and Plateau State (16.69%). On the flip side, Cross River recorded 11.5%, followed by the federal capital, Abuja (11.84%), Lagos (11.95%), Ondo (12.33%) and Kwara State (12.5%).
READ: Arbico Plc records N430.15million loss in nine months
In terms of the food index, Edo State led the list with 21.65% followed by Zamfara (20.88%), Kogi (20.58%), Sokoto (20.5%), and Plateau State (20.26%) while Ondo State recorded the lowest inflation rate with 14.23% followed by Ogun, Lagos, Bauchi and Gombe with 14.47%, 14.57%, 14.85% and 14.88% respectively.
READ: Most Nigerian banks may fail stress tests if economic downturn persists
What this means
The rise in inflationary pressure indicates a persistent decrease in the purchasing power of consumers especially at a time when the economy is on the verge of recession, characterised by increases in price of major food items and service fees.
