- Nigeria’s Inflation Rises to 11.40% in May
Despite efforts by the Central Bank of Nigeria to moderate Nigeria’s consumer prices, cost of goods and services continue to rise.
According to the National Bureau of Statistics (NBS) report released on Monday, the Consumer Price Index (CPI), which measures inflation rate, rose by 11.40 percent year-on-year in May 2019.
This is 0.03 percent higher than the 11.37 percent recorded in April and 0.15 percent higher than 11.25 percent achieved in March. Making it the second consecutive months of increase.
On a monthly basis, the inflation rate increased by 1.11 percent in May 2019, 0.17 percent higher than the 0.94 percent filed in April.
Similarly, the food index increased from 13.34 percent year-on-year in April to 13.37 percent in May.
On month by month basis, the food gauge grew by 1.41 percent in May 2019, up by 0.27 percent from 1.14 percent recorded in April 2019.
The rising cost of production amid high foreign exchange rate continues to hurt consumer spending and the retail sector.
With the unemployment rate at 23.1 percent and the newly increased minimum wage not implemented, buying power remained weak in Africa’s largest economy.
The headline inflation is expected to surge even higher in coming months with the CBN decision to raise the exchange rate for import duty from N306 to N326 for goods coming into the country through seaports.
Also, with crude oil trading at $62 a barrel, down from $73 and foreign investors yet to stop withdrawing funds from the country, the nation’s foreign reserves may soon be affected. Therefore, CBN ability to support the Naira through its intervention programme at the foreign exchange market may be impacted if the Muhammadu Buhari administration failed to retain and lure new investors with a clear economic policy path.