Inflation Falls the First Time In 21 Months

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National Bureau of Statistics reports Monday that Nigeria’s inflation rate reduced by 0.05 per cent in April compared to what obtained in March.

The bureau said that while inflation rate stood at 18.17 per cent in March, it reduced to 18.12 per cent in April.

Read Also: Petrol Imports Rose By 100 Million Litres In January – NNPC

It is the first fall in Nigeria’s inflation rate in the last 21 months.

The last time inflation dropped in Nigeria was in August 2019 when it fell from 11.08 per cent to 11.02 per cent.

The latest rate is contained in the NBS’s Consumer Price Index (CPI) report for April 2021 released in Abuja.

The CPI measures the average change over time in prices of goods and services for day-to-day living.

“On month-on-month basis, the headline index increased by 0.97 per cent in April. This is 0.59 percentage points higher than the rate recorded in March (1.56 per cent),” the report said.

The NBS said that the percentage change in the average composite of CPI for the 12 months period ending in April over the average of CPI for the previous 12 months period was 15.04 per cent.

This, it said, represented a 0.48 per cent increase over 14.55 per cent recorded in March.

It, however, said that the rural index also rose by 0.95 per cent in April, down by 0.57 per cent, compared to the 1.52 per cent rate recorded in March.

“The corresponding twelve-month year-on-year average percentage change for the urban index is 15.63 per cent in April.

“This is higher than 15.15 per cent reported in March, while the corresponding rural inflation rate in April is 14.48 per cent compared to 13 per cent recorded in March,’’ it stated.

Nigeria recorded its first drop in headline inflation since the closure of the land borders in 2019. This could indicate that inflation has reached its peak in March and could be on its way down.

Food inflation

The closely watched index recorded a drop in the month of April 2021, from 22.95% recorded in March 2021 to 22.72%.

On a month-on-month basis, the food sub-index increased by 0.99% in April 2021, down by 0.91% points from 1.9% recorded in March 2021.

The average annual rate of change of the Food sub-index for the twelve-month period stood at 18.58%, indicating 0.65% points higher than 17.93% recorded in the previous month.

The rise in the food index was caused by increases in prices of coffee, tea and cocoa, Bread and cereals, soft drinks, milk, cheese and egg, vegetable, meat, oil and fats, fish and potatoes, yam, and other tubers.

Core inflation

The “All items less farm produce” or Core inflation, which excludes the prices of volatile agricultural produce stood at 12.74% in April 2021, this represents a 0.07% increase compared to 12.67% recorded in March 2021.

On a month-on-month basis, the sub-index stood at 0.99% in April 2021. This was down by 0.07% points compared to 1.06% recorded in March 2021.

The average 12-month annual rate of change of the index increased to 11.25% from 11.01% recorded in March 2021.

The highest increases were recorded in prices of Pharmaceutical products, vehicle spare parts, hairdressing salons, and personal grooming establishment.

It also includes garments, furniture and furnishing, medical services, shoes, and other foot wears, motor cars, major household goods, and fuel and lubricants for personal transport equipment.

State inflation rate

In April 2021, all items inflation on a year-on-year basis was highest in Kogi State with 24.33%, Bauchi (22.93%), and Sokoto State (20.96%), while Abia State (15.94%, Kwara (15.7%), and Katsina (15.58%) recorded the slowest rise in headline inflation.

In terms of food inflation, Kogi State recorded the highest with 30.52%, followed by Ebonyi State with 28.07%, and Sokoto (26.9%), while Abuja, Akwa Ibom, and Bauchi State recorded the slowest with 18.63%, 18.51%, and 17.64% increase respectively.

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