Food price pressure continued into July in Nigeria, as all major food sub-indexes of the consumer price index (CPI) increased, despite the overall falling inflation trend.
The Food Index increased by 20.28percent (year-on-year) in July, up by 0.37percent points from the rate recorded in June (19.91percent).
This represents the highest year on year increase in food inflation since the beginning of the new series in 2009.
The rise in the index was caused by increases in prices of bread and cereals, meat, fish, oils and fats, coffee, tea and cocoa, potatoes yam and other tubers and vegetables.
“Food remains the primary source of inflationary pressure this year, and we adopt a conservative view of inflation until a sharp adjustment in current food price trend”, said the Michael Famorot team of analysts at Vetiva Capital.
The National Bureau of Statistics (NBS) on Monday(August 28) released the inflation rate for the month of July 2017.
The CPI which measures inflation moderated at 16.05 percent (year-on-year) in July 2017, which is 0.05 percent points lower than the rate recorded in June (16.10percent) making it the sixth consecutive decline in the rate of headline year on year inflation since January 2017.
On a month-on-month (MoM) basis, the headline index stood at 1.21percent in July 2017, 0.37percent points lower from the rate of 1.58percent recorded in June.
The percentage change in the average composite CPI for the twelve-month period ending in July 2017 over the average of the CPI for the previous twelve-month period, was 17.47percent, 0.11 percent point lower from 17.58 percent recorded in June 2017.
The Urban index rose by 16.04percent (year-on-year) in July 2017, down by 0.11percent point from 16.15percent recorded in June, and the Rural index increased by 16.08percent in July, from 16.01percent in June. On month-on-month basis, the urban index rose by 1.25percent in July 2017, down by 0.35percent point from 1.60percent recorded in June, while the rural index rose by 1.18percent in July 2017, down by 0.39percent point from 1.57percent in June.
The corresponding 12-month year-on-year average percentage change for the urban index increased from 18.69percent in June, to 18.43percent in July, while the corresponding rural index also increased from 16.56percent in June to 16.60percent in July.
On a month-on-month basis, the food sub-index increased by 1.52percent in July, down by 0.47percent points from 1.99percent recorded in June.
The average annual rate of change of the Food sub-index for the 12-month period ending in July 2017 over the previous 12-month average, was 18.25percent, 0.38percent points from the average annual rate of change recorded in June (17.87percent).
The ”All Items less Farm Produce” or Core sub-index, which excludes the prices of volatile agricultural produce, eased by 0.30percent during the month to 12.20percent points, from 12.50percent recorded in June as all key divisions which contribute to the index increased.
On a month-on-month basis, the Core sub-index increased by 1.00percent in July, 0.32percent points lower, from1.32percent recorded in June. The highest increases were recorded in clothing materials and articles of clothing, furniture and furnishing, books and stationery, medical services, glassware, tableware and household utensils, accommodation services and household textiles.
The average 12-month annual rate of rise of the index was recorded at 15.80percent for the 12-month period ending in July 2017, 0.42percent points lower from the 12-month rate of change recorded in June.
Following the inflation numbers, the Nigerian Economic Summit Group (NESG) research analysts said they are optimistic that “inflation rate will average 15.7percent in 2017 given the continued stability of economic activities.
“Following the monetary and fiscal policies interventions by government and stability in the global oil markets, the local currency and external reserve have improved, though gradually,” NESG said.
On the basis of July inflation rate, the Kayode Tinuoye-led research team at United Capital said, “We expect month-on-month inflation to ease further to 1percent in August and as such, predict a 16percent headline inflation rate for the month of August.”
Food price pressure continued into July in Nigeria, as all major food sub-indexes of the consumer price index (CPI) increased, despite the overall falling inflation trend.
The Food Index increased by 20.28percent (year-on-year) in July, up by 0.37percent points from the rate recorded in June (19.91percent).
This represents the highest year on year increase in food inflation since the beginning of the new series in 2009.
The rise in the index was caused by increases in prices of bread and cereals, meat, fish, oils and fats, coffee, tea and cocoa, potatoes yam and other tubers and vegetables.
“Food remains the primary source of inflationary pressure this year, and we adopt a conservative view of inflation until a sharp adjustment in current food price trend”, said the Michael Famorot team of analysts at Vetiva Capital.
The National Bureau of Statistics (NBS) on Monday(August 28) released the inflation rate for the month of July 2017.
The CPI which measures inflation moderated at 16.05 percent (year-on-year) in July 2017, which is 0.05 percent points lower than the rate recorded in June (16.10percent) making it the sixth consecutive decline in the rate of headline year on year inflation since January 2017.
On a month-on-month (MoM) basis, the headline index stood at 1.21percent in July 2017, 0.37percent points lower from the rate of 1.58percent recorded in June.
The percentage change in the average composite CPI for the twelve-month period ending in July 2017 over the average of the CPI for the previous twelve-month period, was 17.47percent, 0.11 percent point lower from 17.58 percent recorded in June 2017.
The Urban index rose by 16.04percent (year-on-year) in July 2017, down by 0.11percent point from 16.15percent recorded in June, and the Rural index increased by 16.08percent in July, from 16.01percent in June. On month-on-month basis, the urban index rose by 1.25percent in July 2017, down by 0.35percent point from 1.60percent recorded in June, while the rural index rose by 1.18percent in July 2017, down by 0.39percent point from 1.57percent in June.
The corresponding 12-month year-on-year average percentage change for the urban index increased from 18.69percent in June, to 18.43percent in July, while the corresponding rural index also increased from 16.56percent in June to 16.60percent in July.
On a month-on-month basis, the food sub-index increased by 1.52percent in July, down by 0.47percent points from 1.99percent recorded in June.
The average annual rate of change of the Food sub-index for the 12-month period ending in July 2017 over the previous 12-month average, was 18.25percent, 0.38percent points from the average annual rate of change recorded in June (17.87percent).
The ”All Items less Farm Produce” or Core sub-index, which excludes the prices of volatile agricultural produce, eased by 0.30percent during the month to 12.20percent points, from 12.50percent recorded in June as all key divisions which contribute to the index increased.
On a month-on-month basis, the Core sub-index increased by 1.00percent in July, 0.32percent points lower, from1.32percent recorded in June. The highest increases were recorded in clothing materials and articles of clothing, furniture and furnishing, books and stationery, medical services, glassware, tableware and household utensils, accommodation services and household textiles.
The average 12-month annual rate of rise of the index was recorded at 15.80percent for the 12-month period ending in July 2017, 0.42percent points lower from the 12-month rate of change recorded in June.
Following the inflation numbers, the Nigerian Economic Summit Group (NESG) research analysts said they are optimistic that “inflation rate will average 15.7percent in 2017 given the continued stability of economic activities.
“Following the monetary and fiscal policies interventions by government and stability in the global oil markets, the local currency and external reserve have improved, though gradually,” NESG said.
On the basis of July inflation rate, the Kayode Tinuoye-led research team at United Capital said, “We expect month-on-month inflation to ease further to 1 percent in August and as such, predict a 16percent headline inflation rate for the month of August.”
Iheanyi Nwachukwu
