Increased Spending, Energy, Production Costs Drive Inflation to 21.34%

The Consumer Price Index (CPI) which measures the rate of change in prices of goods and commodities increased by 5.72 per cent to 21.34 per cent year on year in December compared to 15.63 per cent in December 2021, the National Bureau of Statistics (NBS) stated on Monday.

Month-on-month inflation also rose to 1.71 per cent in the review period compared to 1.39 per cent in November.

According to the CPI figures for December, month-on-month inflation may have been caused by a sharp increase in demand usually experienced during the festive season, as well as an increase in the cost of production including increase in energy, transportation costs, and exchange rate depreciation among others.

Food inflation rose to 23.75 per cent year-on-year which was 6.38 per cent higher compared to 17.37 per cent recorded in December 2021.

On a month-on-month, the food inflation stood at 1.89 per cent, which was 0.49 per cent higher than the 1.40 per cent in November.

The rise in food inflation was attributed to increases in prices of bread and cereals, oil and fat, potatoes, yam, and other tubers, fish, and food products.

The core index, which excludes the prices of volatile agricultural produce stood at 18.49 per cent year on year in December, up by 4.62 per cent when compared to the 13.87 per cent recorded in 2021.

Month-on-month, core inflation stood at 1.33 per cent in December compared to 1.67 per cent in the preceding month.

Core inflation resulted from increases in prices of gas, liquid fuel, passenger transport by air, vehicle spare parts, fuels and lubricants for personal transport equipment, and solid fuel among others.

On year-on-year, urban inflation increased to 22.01 per cent, compared to 16.17 per cent in 2021 while the index rose to 1.80 per cent month on month in December from 1.50 per cent in November.

Rural inflation stood at 20.72 per cent year-on-year, higher than 15.11 per cent in December 2021 while month-on-month, the index rose to 1.63 per cent from 1.30 per cent.

 At the states level, all items inflation on yearly basis was highest in Bauchi (23.79 per cent), Kogi (23.35 per cent), Anambra (23.13 per cent), while Taraba (18.98 per cent), Osun (19.09 per cent) and Kwara (19.18 per cent) recorded the slowest rise in the headline index.

Month-on-month basis, however, inflation was highest in Oyo (3.48 per cent), Abuja (3.05 per cent), Sokoto (2.58per cent), while Ebonyi (0.11 per cent), Ekiti (0.68 per cent) and Nasarawa (0.70 per cent) recorded the slowest rise.

Also, year-on-year, food inflation was highest in Kwara (27.90 per cent), Imo (26.94 per cent) and Ebonyi (26.28 per cent), while Sokoto (20.90 per cent), Taraba (21.59 per cent) and Cross River (21.71 per cent) recorded the slowest rise in the index.

 On a month-on-month basis, however, food inflation was highest in Sokoto (3.38 per cent), Oyo (3.10 per cent) and Kaduna (2.97 per cent), while Nasarawa (0.06 per cent), Osun (0.70 per cent) and Kogi (0.76 per cent) recorded the slowest rise.

 James Emejo in Abuja

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