Nigeria’s Inflation Rate Reaches 16.5% | Independent Newspapers Limited
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Nigeria’s Inflation Rate Reaches 16.5%

Adeosun & Emefiele
Posted: Jul 18, 2016 at 1:43 pm   /   by   /   comments (0)

Isuma Mark, Abuja


Nigeria’s inflation continues to accelerate as latest report on Consumer Price Index (CPI) used in measuring inflation in the Nigerian economy has risen to an unprecedented point of 16.5 per cent.

This is the first time since 2005 that CPI has risen to 16.5 per cent as the economy continues to unravel rapidly.

The report, which was released on Monday by the National Bureau of Statistics (NBS), shows that inflation for the month of June rose from 15.6 per cent in May 2016 to 16.5 percent in June 2016.

Independent had reported two months ago that Nigeria’s inflation could climb higher considering cost of energy and food prices. This factors, NBS mentioned exerted influence consequently inducing latest inflation rate.

According to the NBS’ report, “In June, the Consumer Price Index (CPI) which measures inflation continued to record relatively strong increases for the fifth consecutive month,” it said.

Statistically, it said, “The Headline index increased by 16.5 per cent (year-on-year), 0.9 per cent points higher from rates recorded in May (15.6 per cent).

“Most COICOP divisions which contribute to the headline index increased at a faster pace, the increase was however weighed upon by a slower increase in three divisions; Recreation & Culture, Restaurant & Hotels, and Miscellaneous Goods & Services Year on year, energy prices, imported items and related products continue to be persistent drivers of the core sub-index,” the report added.

According to it, the Core index increased by 16.2 per cent in June, up by approximately 1.2 per cent points from rates recorded in May (15.1 per cent). It added that, during the month, the highest increases were seen in the electricity, liquid Fuel (kerosene), furniture and furnishings, passenger transport by road, fuels and lubricants for personal transport equipment.

The report said that apart from farm produce, the core sub-index increased by 16.2 per cent per cent in June (year-on-year), up approximately by 1.2 per cent points from 15.1 per cent recorded in May.

Also, “The Core sub-index has increased at a faster pace for five consecutive months. Over the first six months of the year, the Core subindex increased by 12.8 per cent, up 5.2 per cent points from rates recorded in the corresponding period in 2015.”

This continues rise has been consistent with Independent projection that inflation would rise up to 20 per cent before the end of 2016 due to the crisis rocking the forex policy of the Central Bank of Nigeria. This crisis has been blamed for increasing jump in inflation as importers continue to suffer losses due to lack of foreign exchange.

The increase in pump price of fuel added new impetus to increase in all fronts. With Nigeria depending on imports of everything, the ember months are expected to induce further inflation as demands for goods might ultimately outweigh availability.