Hardship heightens as Nigeria's inflation rate hits highest mark in 28 years

Nigeria's inflation rate rose to 33.95% in May 2024, as reported by the National Bureau of Statistics (NBS) in its latest Consumer Price Index (CPI) report.

This marks a 0.26 percentage point increase from the April 2024 headline inflation rate, according to the NBS Consumer Price Index report published on Saturday, June 15.

Higher Food, rent, transport prices force Nigeria's inflation rate to hit 33.95 per cent
Source: UGC

The data shows that, on a year-on-year basis, the headline inflation rate was 11.54% higher than the 22.41% recorded in May 2023.

This indicates a significant increase in the year-on-year headline inflation rate from May 2023 to May 2024.

However, on a month-on-month basis, the headline inflation rate for May 2024 was 2.14%, a 0.15 percentage point decrease from the 2.29% recorded in April 2024.

According to the NBS, this means that the rate of increase in average prices in May 2024 was lower than that of April 2024.

The main drivers of headline inflation in May 2024 were food and non-alcoholic beverages at 17.59%, Housing, water, electricity, gas, and other fuels at 5.68%, and clothing and footwear at 2.60%.

Other contributors include transport at 2.21%, furnishings, household equipment, and maintenance at 1.71%, education at 1.34%, health at 1.02%, miscellaneous goods and services at 0.56%, restaurants and hotels at 0.41%, alcoholic beverages, tobacco, and kola at 0.37%, recreation and culture at 0.23%, and communication at 0.23%.

Food Inflation skyrockets to 40%

The NBS report also highlighted that the food inflation rate in May 2024 was 40.66% on a year-on-year basis, which is 15.84% higher than the 24.82% recorded in May 2023.

The rise in food inflation was attributed to increased prices of several items, including Semovita, Oatflake, Yam flour prepackaged, and Garri, all of which fall under the Bread and Cereals category.

Other contributing items included Irish potatoes, yam, and water yam (from the Potatoes, Yam, and Other Tubers category), palm oil and vegetable oil (under the Oils and Fats category), stockfish, mudfish, and crayfish (under the Fish category), as well as beef head, live chicken, pork head, and bush meat (under the Meat category).

In recent years, food prices in Nigeria have surged as insecurity in several farming states, including Benue, Plateau, and Kaduna, has forced farmers to abandon their land.

The situation worsened last year when the Bola Tinubu administration removed petrol subsidies, affecting many Nigerians who rely on petrol for their vehicles and electricity generators.

Additionally, the government floated the naira to align the official exchange rate with the black market rate.

Nigeria's naira has plummeted to unprecedented lows in both the official and unofficial markets due to heightened forex demand and rising prices of goods and services nationwide.

In response, the Nigerian government has introduced measures and reforms to protect the foreign exchange market and counter speculative activities.

Source: Legit.ng