Nigeria’s headline inflation rate dropped from 34.19% in June to 33.40% in July for the first time since December 2022, but the core inflation rate rose by 0.10%.
This was disclosed in the Consumer Price Index (CPI) inflation report published by the National Bureau of Statistics (NBS) on Thursday.
The NBS CPI report showed that Nigeria witnessed a 0.79% decrease in the headline inflation rate in July, which means that overall costs fell.
However, this drop in prices affected only farm produce and energy.
The report also specified that the July inflation figure was 9.32% higher than what was obtained in 2023. In other words, inflation in July 2024 was worse than inflation in July 2023.
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“On a year-on-year basis, the headline inflation rate was 9.32% points higher compared to the rate recorded in July 2023, which was 24.08%. This shows that the headline inflation rate (year-on-year basis) increased in July 2024 compared to the same month in the preceding year (i.e., July 2023),” the report read in part.
Furthermore, on a month-on-month basis, the headline inflation rate in July 2024 was 2.28%, which was 0.03% lower than the rate recorded in June 2024 (2.31%). This means that in July 2024, the rate of increase in the average price level was lower than the rate of increase in the average price level in June 2024.”
Meanwhile, core inflation remained stubbornly high in July, despite the slight decrease in the overall inflation. Prices for key services, excluding volatile agricultural products and energy, rose significantly in July.
According to the NBS report, the core inflation rate for July was 27.47%, a slight increase from the 27.40% recorded in June 2024. The services that contributed most to this rise include rent, transportation and healthcare.
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“The “All items less farm produces and energy” or Core inflation, which excludes the prices of volatile agricultural produces and energy stood at 27.47% in July 2024 on a year-on-year basis; up by 6.99% when compared to the 20.47% recorded in July 2023,” the NBS CPI report read.
“On a month-on-month basis, the Core Inflation rate was 2.16% in July 2024. It stood at 2.06% in June 2024, an increase of 0.10%.
“The highest increases were recorded in prices of the following items, Rents (Actual and Imputed Rentals for Housing Class), Bus Journey intercity, Journey by motorcycle, etc (under Passenger Transport by Road Class), and Accommodation Service, Laboratory service, X-ray photography, Consultation Fee of a medical doctor, etc (under Medical Services Class).”
The report attributed the drop in overall inflation and food inflation to lower costs of certain food items like canned milk, powdered milk, fish, watermelon, and bread. Nigeria’s food inflation rate fell to 39.53% in July, down from 40.87% in June.
However, the decline in overall inflation doesn’t reflect the situation in all states. In some areas, headline inflation surged dramatically. For example, Abuja saw an increase of 3.91%, Borno 3.84%, and Enugu 3.76%. Other states like Taraba (0.17%), Kwara (0.62%), and Ondo (0.91%) also experienced inflation increases, though at a slower rate.
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