The Consumer Price Index (CPI), which measures the rate of change in prices of goods and commodities, rose to 29.90 percent in January, compared to 28.92 percent in the preceding month, the National Bureau of Statistics (NBS) said on Thursday.
Year-on-year headline inflation was 8.08 percent higher, compared to 21.82 percent in January 2023.
The CPI report for the month under review indicated that the food inflation rate increased by 11.10 percent year-on-year to 35.41 percent, compared to 24.32 percent in January 2023.
The rise in the food index was attributed to increases in prices of bread and cereals, potatoes, yam and other tubers, oil and fat, fish, meat, fruit, coffee, tea, and cocoa.
On the other hand, core inflation, which excludes the prices of volatile agricultural products and energy, also rose by 4.71 percent to 23.59 percent year-on-year, compared to 18.88 percent in January 2023.
Core inflation was driven by the highest increases in prices of passenger transport by road, medical services, actual and imputed rentals for housing, pharmaceutical products, accommodation services, and passenger transport by air, among others.
Year-on-year, urban inflation increased by 9.40 percent to 31.95 percent, compared to 22.55 percent in January 2023, while month-on-month, the index rose by 0.30 percent to 2.72 percent in January, compared to 2.42 percent in December.
The corresponding 12-month average for the urban inflation rate was 27.01 percent in January, compared to 19.91 percent in January 2023.
On the other hand, rural inflation increased by 6.97 percent to 28.10 percent, year-on-year, compared to 21.13 percent in January 2023.
Month-on-month, the rural index rose by 0.40 percent to 2.57 percent, compared to 2.17 percent in the preceding month.
The corresponding 12-month average for the rural inflation was 23.85 percent in January, compared to 18.84 percent in January 2023.
At the state level, however, general inflation year-on-year was highest in Kogi (35.79 percent), followed by Oyo (34.58 percent), and Akwa Ibom (33.16 percent), while Borno (22.57 percent), Taraba (24.83 percent) and Benue (26.64 percent) recorded the slowest rise in headline inflation.
On a month-on-month basis, however, the highest price increases were recorded in Ondo (3.79 percent), Osun (3.77 percent), Jigawa (3.58 percent), while Bayelsa was (0.45 percent), Yobe (1.10 percent), and Ogun (1.35 percent) recorded the slowest rise.
Also, year-on-year, food inflation was highest in Kogi (44.18 percent), Kwara (40.87 percent), and Rivers (40.08 percent), while Bauchi (28.83 percent), Adamawa (29.80 percent), and Kano (30.08 percent) recorded the slowest rise.
Month-on-month basis, food inflation was highest in Ondo (4.69 percent), Osun (4.59 percent), and Edo (4.58 percent), while Bayelsa (0.24 percent), Yobe (0.97 percent) and Ogun (1.44 percent) recorded the slowest rise.
Meanwhile, the Centre for the Promotion of Private Enterprise (CPPE) called on the government to initiate measures that would ameliorate the negative effect of inflation on manufacturers and operators in the real sector.
CPPE also stated that headline inflation, which rose to an all-time high of 29.9 percent in January, would accelerate poverty and deteriorate citizens’ welfare, as food inflation went up to 35.4 percent in January, as against 33.9 percent in December.
Commenting on the January inflation, Chief Executive Officer of CPPE, Dr. Muda Yusuf, regretted that the major inflation drivers were not receding, saying that if anything, they have become even more intense.
These drivers, according to him, are depreciating exchange rate, surging transportation costs, logistics challenges, forex market illiquidity, astronomical hike in diesel cost, insecurity in farming communities, and structural bottlenecks to production.
Yusuf said, “Elevated inflationary pressures also aggravate pressure on production costs, weaken profitability, erode shareholders value and dampen investors’ confidence.
“Only very few producers or service providers can transfer cost increases to their consumers. The implication is that manufacturers and other investors are currently under tremendous pressure.
“The government needs to review its tariff policies by granting concessionary import duty on intermediate products for agro-allied industries and other industrialists.
“The same is true of investors in logistics sector. The exchange rate benchmark for the computation of import duty should be pegged at N1000/dollar.”
According to the group, this is necessary to reduce the pressure of escalating costs of cargo clearing and minimise uncertainty in the international trade processes.
Yusuf stated, “The policy choice of complete floating of the naira requires a rethink in the light of the current inflationary outcomes, volatility and market imperfections. The effects of high energy cost on economic activities are profound.
“It is very difficult to tame inflation if we do not fix power, logistics and forex issues. Regrettably, there are no quick fixes in these areas. But it is important to prioritise these issues and ensure stability and recovery.”
James Emejo and Dike Onwuamaeze
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