- Inflation Rate Falls Slightly to 11.14% in July
The cost of goods and services in Nigeria increased at a slower pace in July, according to the National Bureau of Statistics report released on Wednesday.
The Consumer Price Index, which measures inflation fell by 0.09 percent from 11.23 percent year-on-year in June to 11.14 percent in July. The eighteenth consecutive month of moderation.
On a monthly basis, the inflation rate rose by 1.13 percent in July, down from the 1.24 percent recorded in June. The first time month on month inflation has declined in five months.
The food index also declined from 12.98 percent in June to 12.85 percent in July, the tenth consecutive month of decline. The report attributed the increase in the food index to the rising cost of Potatoes, yam and other tubers, Vegetables, Bread and cereals, Fish, Oils and Fat and Fruits.
On a month-on-month basis, the food index grew by 1.40 percent in July 2018 compared to 1.57 percent recorded in June. Also, the first time the month on month food inflation has declined since February 2018.
The stable foreign exchange market due to the new forex policy adopted by the Central Bank of Nigeria has helped investors and manufacturers access forex at an affordable rate.
However, despite the progress recorded with the consumer prices, the CBN has refused to lower the policy rate from 14 percent. The apex bank said rising interest rates in developed nations may hurt capital inflow and weigh on its intervention program. Therefore, the CBN led monetary policy is likely to raise interest rates in coming months, not just to sustain capital importation but also to curb the inflation rate that is projected to rise once the implementation of the 2018 budget and election spending commences.