Nigeria’s annual inflation rate surged to a 28-year high of 33.95% in May 2024, according to official data released recently.
According to the National Bureau of Statistics (NBS), the inflation rate in May 2024 was 0.26 percent higher than the 33.69 percent recorded in April 2024. The lowest inflation figure in 2024 was 29.90 percent, recorded in January 2024.
The annual inflation rate for May 2024 also reflected an 11.54 percentage point increase compared to the 22.41 percent recorded in May 2023.
“This shows that the headline inflation rate (year-on-year basis) increased in the month of May 2024 when compared to the same month in the preceding year (i.e., May 2023),” the NBS stated.
This also marks the 18th consecutive month of rising inflation, up from 33.69% the previous month [April 2024].
Analysts attribute the main drivers of inflation in Nigeria to high food prices and a weaker Naira.
According to data from the National Bureau of Statistics, food and non-alcoholic beverages were the primary contributors to inflation in May 2024. Food inflation, which makes up the largest portion of Nigeria’s inflation basket, increased to 40.66% from 40.53% the previous month, and 15.84 percentage points higher compared to the rate recorded in May 2023 (24.82 per cent).
According to local reports, food prices have risen across Nigeria as farmers abandon their farms due to insecurity in many farming states such as Benue, Plateau and Kaduna. The situation deteriorated in 2023 after the Bola Tinubu administration removed subsidies on petrol, which many Nigerians use to power their vehicles and electricity generators.
In 2023, as reported by BitKE, the government also floated the Naira in an effort to unify the official exchange rate to the dollar with what is obtained in the black market.
Nigeria🇳🇬Formally Unifies Foreign Exchange Trading Rates as Naira Devalues by 36%
This marks the first time, since 2016, that the Naira has recorded a big fall on the official market before the Central Bank of Nigeria introduced a managed exchange rate in 2017.… pic.twitter.com/u8UWAbwaFb
— BitKE (@BitcoinKE) June 15, 2023
In response to persistent inflation, the central bank raised interest rates in May 2024 for the third time this year. However, Central Bank Governor, Olayemi Cardoso, has indicated that interest rates will remain high as long as necessary to curb inflation.
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