August 15, (THEWILL) – Nigeria’s inflation rate in the month of July 2022 rose to a 17-year high of 19.64%. This compares to 18.6% recorded in the previous month of June 2022.
The NBS said that on a month-on-month basis, the Headline inflation rate in July 2022 was 1.817 per cent, which was 0.001 percent higher than the rate recorded in June 2022 (1.816 per cent).
“The percentage change in the average CPI for the twelve months period ending July 2022 over the average of the CPI for the previous twelve months period was 16.75%, showing a 0.46% increase compared to 16.30% recorded in July 2021,” the report said.
The last time Nigeria’s inflation was above 19.64% was in September 2005 when it rose to 24.32%. Notably, the uptick in the inflation rate was driven by increases in the food and core index.
According to the NBS, the rise in food inflation was caused by increases in prices of bread and cereals, food products, potatoes, yam and other tubers, meat, fish, oil, and fat.
Meanwhile, the average annual rate of food inflation for the twelve-month period ending July 2022 over the previous twelve-month average was 18.75%, which represents a 1.42% point decline from the average annual rate of change recorded in July 2021 (20.16%).
The ‘’All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 16.26% in July 2022, compared to 15.75% recorded in the previous month. This also represents the highest core inflation rate since January 2017, when the rate stood at 17.8%.
On a month-on-month basis, the core inflation rate was 1.75% in July 2022. This was up by 0.20% when compared to 1.56% recorded in June 2022.
Nigeria is one of the countries with significant uptick in its cost of living as a result of high inflationary pressure. On a year-to-date basis, Nigeria’s inflation rate has increased by over 400 basis points from 15.63% recorded in December 2021 to 19.64% in the review month.
This implies that the consumer price index has increased by 12.7% between January and July 2022. This means that the purchasing power of Nigerians has been eroded. In basic term, keeping income at a fixed level, Nigerians are not able to purchase as much as they have been able to with their monies.
The closely watched indicator rose to its highest level in 14 months, standing at 22.02% in July 2022, representing a 1.42%-point increase compared to 20.6% recorded in the previous month. On a month-on-month basis, the food inflation rate in July stood at 2.04%, this is 0.01% lower than 2.05% recorded in the previous month.
Further breakdown of the report shows that the urban inflation rate rose by 2.08% to 20.09% in July 2022 from 18.01% recorded in July 2021, while the rural inflation rate hit 19.22% from 16.75% recorded in the corresponding period of 2021.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
