Nigeria’s inflation eases first time in 12 months to 21.34%

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BY BAMIDELE FAMOOFO

Uba Group

Nigeria’s headline inflation eased for the first time in 12 months, settling at 21.34 percent year -on -year in December 2022, according to figures released by the National Bureau of Statistics on Monday.

Inflation stood at 21.47 percent on an annual basis in November.

The outturn in December is 36 basis points above Cordros’ estimate (20.98% y/y) and 46bps lower than Bloomberg’s median consensus estimate (21.80% y/y).

However, on a month-on-month basis, headline inflation increased by 32bps to 1.71 percent as against 1.39 percent m/m increase recorded in November 2022.

Food inflation moderated by 37bps to 23.75 percent y/y compared with 24.13 percent recorded in November 2022.

NBS explained that the slowdown in food inflation was despite the increases in prices of Bread and cereals, Oil and fat, Potatoes, Yam and other tubers, Fish and Food Product.

However, on a month-on-month basis, food inflation settled at 1.89 percent, relative to the 1.40 percent m/m recorded in November.

Elsewhere, the core inflation increased by 25bps to 18.49 percent y/y (November: 18.24 y/y).

Analysts at Cordros Research in a review of the figures released by the NBS, said: “We note that pressures were significant in prices of Gas, Liquid fuel, Passenger transport by Air, Vehicles spare parts, Fuels and lubricants for personal transport equipment, Solid fuel etc.”

However, compared to the previous month, the core index eased by 34bps to 1.33 percent m/m in December 2022 as against 1.67 percent m/m printed in November 2022.

On a year-on-year basis, in the month of December 2022, the urban inflation rate was 22.01 percent, this was 5.85 percent higher compared to the 16.17 percent recorded in December 2021.

On a month-on-month basis, the urban inflation rate was 1.80 percent in December 2022; this was 0.31 percent higher compared to November 2022 (1.50%).

The corresponding twelve-month average for the urban inflation rate was 19.38 percent in December 2022. This was 1.86 percent higher compared to the 17.52 percent reported in December 2021.

The rural inflation rate in December 2022 was 20.72 percent on a year-on-year basis; this was 5.61 percent higher compared to the 15.11 percent recorded in December 2021. On a month-on-month basis, the rural inflation rate in December 2022 was 1.63 percent, up by 0.33 percent compared to November 2022 (1.30%). The corresponding 12 months average for the rural inflation rate in December 2022 was 18.34 percent. This was 1.94 percent higher compared to the 16.40 percent recorded in December 2021.

Meanwhile, State-by-State analysis of inflation in the review period showed that Bauchi generally (All items put into consideration) recorded highest inflation rate in December at 23.79 percent on year on year basis followed by Kogi, (23.35%), Anambra (23.13%), while Taraba (18.98%), Osun (19.09%) and Kwara (19.18%) recorded the slowest rise in headline year-on-year inflation.

On a month-on-month basis, however, December 2022 recorded the highest increases in Oyo (3.48%), Abuja (3.05%), Sokoto (2.58%), while Ebonyi (0.11%), Ekiti (0.68%) and Na-sarawa (0.70%) recorded the slowest rise on month-on-month inflation.

Similarly, food inflation on a year-on-year basis was highest in Kwara (27.90%), Imo (26.94%) and Ebonyi (26.28%), while Sokoto (20.90%), Taraba (21.59%) and Cross River (21.71%) recorded the slowest rise in year-on-year food inflation. On a month-on-month basis, however, December 2022 food inflation was highest in Sokoto (3.38%), Oyo (3.10%) and Kaduna (2.97%), while Nasarawa (0.06%), Osun (0.70%) and Kogi (0.76%) recorded the slowest rise on month-on-month inflation.

“CBN"