Economy

Food prices soars to an all time high as inflation rate hits 17-year high of 20.8% 

For the first time in 17 years, Nigeria’s inflation rate rose to 20.8 percent as a result of soaring food prices and supply chain disruption, according to the National Bureau of Statistics (NBS).

 

The Consumer Price Index report for September 2022 released on Monday shows that inflation figure for the preceding month – August – was 20.52 percent.

 

The NBS said increase in the food index was attributed to the rise in prices of bread and cereals, food products, potatoes, yams, and other tubers, oil, and fat.

 

On a month-on-month basis, the index rose by 1.36 percent compared to the 1.77 percent increase recorded in the previous month.

 

NUPRC COMMERCIAL ENGLISH

 

The NBS report showed that urban inflation stood at 21.25 percent last month as against 17.19 percent recorded in the corresponding period of 2021, while rural inflation stood at 20.32 percent.

 

The food inflation rate stood at 23.34 percent on a year-on-year basis, recording a surge from the 23.12 percent of the previous month.

 

The ‘’All items less farm produce’’ or core inflation, including the prices of volatile agricultural produce, stood at 17.60 percent, up from 17.2 percent recorded in August 2022.

 

The NBS said that the highest increases were recorded in prices of gas, liquid fuel, passenger transport by air, passenger travel by road, and solid fuel.

 

The bureau explained that rising inflation rate was caused by soaring food prices, disruption in food supply chain, rise in import cost due to the currency depreciation, and increase in the cost of production.

 

The inflation rate increase places renewed pressure on the Nigerian apex bank to increase interest rates and put inflationary pressure at bay.

 

Last month, the policy-setting committee of the Central Bank of Nigeria raised the Monetary Policy Rate, which measures interest rate, from 14 percent to 15.5 percent, the third consecutive increase in 2022.

 

On Monday, a report by Agora Policy, which analysed Nigeria’s economic datasets from 2011 to 2021, called for in-depth reforms in trade and investment, inflation, interest and exchange rates, unemployment, and poverty.

 

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