• Thursday, June 13, 2024
businessday logo

BusinessDay

Inflation rises in Jan, food prices stable

Food inflation surges 59% in low, middle-income countries – World Bank

market setting_inflation_gdp

Inflation rate rose for the second consecutive month to 8.2 percent in January, up from eight percent the previous month despite a sharp fall in the naira, the National Bureau of Statistics (NBS) said on Monday.

Food inflation was flat at 9.2 percent in January, unchanged from December. Food prices account for bulk of the inflation basket.

The Central Bank of Nigeria (CBN) devalued the naira by eight percent in November, with many analysts fearing the downward pressure on currency in a country that imports almost 80 percent of what it consumes could stoke inflationary pressures.

Read also: EFCC finally arrests former Governor Nyako’s son, Abdul-Aziz

The latest figures suggest those fears have not yet been realised, although price pressure could still feed through later this year.

“Prices increased at a faster pace in most major non-food divisions such as housing, water, electricity,” the NBS said in a report.

A sharp rise in inflation would be an added headache for President Goodluck Jonathan before a closely fought election in which his record on security, corruption and the economy is under scrutiny.

The naira has remained under pressure despite the one-off devaluation trading outside central bank’s target band of 160-176 to the dollar, on weak global oil prices and escalating tensions after presidential elections in Africa’s biggest economy was delayed.

The NBS has said in its outlook for 2015, that it expected inflation this year to rise to 8.78 percent, up from an estimated 8.0 percent last year, driven by the devaluation of the naira.