Inflation in Africa’s biggest economy has risen to double-digits since 2016, eroding incomes and savings, and prompting the central bank to hike interest rates to their highest level in nearly two decades.

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On a year-on-year basis, the inflation rate was 5.94% points higher compared to the rate recorded in September 2022, which was 20.77%, indicating an increase when compared to the same month in the preceding year.

Furthermore, on a month-on-month basis, the headline inflation rate in September 2023 was 2.10%, which was 1.08% lower than the rate recorded in August 2023 (3.18%).

“Food and non-alcoholic beverages were the biggest contributors to the rise in inflation,” the bureau said.

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According to the report, the food inflation rate in September quickened to 30.64 per cent on a year-on-year basis, which was 7.30 per cent points higher compared to the rate recorded in September 2022 (23.34 per cent).

Food prices have been on the rise across Nigeria in recent years. The situation deteriorated due to the impact of government policies such as the removal of subsidies on petrol, among others.

President Bola Tinubu on 29 May during his inauguration, announced the removal of subsidy on petrol. This development has caused hardship for many Nigerians with its attendant increase in the prices of goods and services.

Over the past four months, the naira has depreciated by over 50 per cent at both the authorised and unauthorised market segments, after the Central Bank of Nigeria (CBN) announced in June that it had collapsed all forex windows into the Investors and exporters (I&E) window.

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The move, according to the apex bank, is part of the Nigerian government’s efforts to improve liquidity and stability in the market and attract foreign investors into the Nigerian economy.

Although the policy was widely applauded as well-intentioned and necessary, it has put additional pressure on the local currency and manufacturers, with ripple effects on domestic prices.

Arise News/Premium Times

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