Nigeria’s inflation rate changed direction in February as it rose 15.7% from 15.6% recorded in the previous month. This represents a 0.1% point increase compared to the rate recorded in January 2022.
This is according to the consumer price index report, released by the National Bureau of Statistics (NBS).
The uptick in Nigeria’s inflation rate is attributed to the increase in the price of goods and services, following the fuel scarcity across the country in February.
Nairametrics had earlier reported that analysts predicted an uptick in the inflation figures for the month of February 2022, owing to the ripple effect of fuel scarcity on cost of transportation, operation cost, food prices amongst others.
- The consumer price index rose by 15.7% year-on-year from 366.8 index points recorded in February 2021 to 424.4 points in February 2022.
- On month-on-month basis, the headline index increased to 1.63% in February 2022, which is 0.16% rate higher than the rate recorded in January 2022 (1.47%).
- The urban inflation rate increased to 16.25% (year-on-year) in February 2022 from 17.92% recorded in February 2021, while the rural inflation rate increased to 15.18 per-cent in February 2022 from 16.77 percent in February 2021.
- Core inflation also rose to its highest level in over 4 years at 14.01%, while food inflation dropped to 17.11% in the review period from 17.13% recorded in January 2022.
The food inflation rate, which is a closely watched index dropped to 17.11% in February 2022 from 17.13% recorded in the previous month. This represents the lowest food inflation rate recorded in Nigerian since September 2020.
According to the NBS report, the highest increases in food prices were of Bread and cereals, Food product, Potatoes, yam and other tuber, Oils and fats and fruit.
On month-on-month basis, the food sub-index increased to 1.87% in February 2022, up by 0.25% points from 1.62% recorded in January 2022.
The average annual rate of change of the Food sub-index for the twelve-month period ending February 2022 over the previous twelve-month average was 19.69%, which is 0.4% lower than the average annual rate of change recorded in January 2022 (20.09$).
The ‘’All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 14.01% in February 2022, up by 0.14% when compared to 13.87% recorded in January 2022.
This is the highest core inflation rate in over 4 years, since April 2017, largely attributed to the significant increase in price of petroleum product due to the scarcity.
According to the report, the highest increases were recorded in prices of gas, liquid fuel, wine, tobacco, spirit, narcotics, solid fuels, cleaning, repair and hire of clothing, garments, shoes and other foot wear, other services in respect of personal transport equipment, clothing materials, other articles of clothing and clothing accessories, and other services.
In February 2022, all items inflation on year-on-year basis was highest in Cross River (18.84%), Gombe (17.70%) and Abuja (17.68%), while Kwara (13.82%), Sokoto (13.93%) and Anambra (14.43%) recorded the slowest rise in headline year-on-year inflation.
On the other hand, food inflation on a year-on-year basis was highest in Kogi (21.04%), Enu-gu (20.31%) and Kwara (20.03%), while Sokoto (13.89%), Anambra (14.18%) and Bauchi (14.43%) recorded the slowest rise in year-on-year food inflation.
What this means
The increase in Nigeria’s inflation rate means that Nigerian’s purchasing power is been eroded by the increase in the prices of goods and services. In other words, your money is now worth lesser than it was in the previous month.