Nigeria’s inflation rate increased to 21.8% in January 2023 from 21.34% in the prior month, the highest increase since September 2005.
Headline Inflation for January 2023 was 21.82%, from 21.34% in December 2022.
Food Inflation was 24.32% in January 2023 from 23.74% in December 2022.
Urban inflation was 22.55%. Rural Inflation was 21.13%.
Read the full CPI report for January 2023 here: https://t.co/ResHYKcEhK pic.twitter.com/E4r5X6CzPr
— NBS Nigeria (@NBS_Nigeria) February 15, 2023
On a monthly basis, consumer prices rose sharply by 1.87% marking the highest increase in nearly 16 years, following a 1.71% rise in the previous month.
The primary factors contributing to the surge in inflation were the significant increases in food prices and the depreciation of the Nigerian currency, the Naira.
Food prices, which have the highest weight in the consumer price index (CPI) basket, rose to 24.32% in January 2023 from 23.75% in the preceding month. The contributions of items on a class basis to the increase in the headline index are:
- Bread and Cereal (21.67%)
- Actual and Imputed Rent (7.74%)
- Yam and Tuber (6.06%)
- Vegetable (5.44%)
- Meat (4.78%).
Outside of food, the highest increases were recorded in prices of gas, liquid fuel, passenger transport by air, vehicles spare parts, fuels, and lubricants for personal transport equipment, solid fuel.
Inflation, which had been on the rise for 10 consecutive months, experienced a temporary dip to 21.34% in December 2022, however, it is back up ahead of the upcoming general election in February 2023.
High inflation, weak economic growth, and mounting insecurity are at the forefront of the minds of many voters and are likely to play a major role in determining the outcome of the elections.
Policymakers have attributed Nigeria’s inflationary pressures to its infrastructure problems and the country’s reliance on imports for many consumer goods.
The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has stated that the bank will continue to adopt a hawkish stance on interest rates if inflation remains at an elevated level.
In January 2023, the Central Bank of Nigeria increased its key interest rate to 17.5% marking a total of 600 basis points of rate hikes since May 2022.
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