Nigeria's Inflation Rate Rises to Double Digit; Increases by 11.4% YoY in February 2016

Proshare

Tuesday, March 15, 2016 01:46PM / NBS

All Items Index

In February, the Consumer Price Index (CPI) which measures inflation recorded a significant uptick. The headline index increased by 11.4% (year-on-year) in February, roughly 1.76% points higher from rates recorded in January (9.6%).

The faster pace of increases which led to the overall increase in the headline index were recorded across almost all major divisions which contribute to the Headline index with the exception of the Restaurants and Hotels division which increased, albeit at a slower pace.

After increasing at the same pace for two months, the pace of increases of food prices as recorded by the Food sub-index increased at faster pace in February. The Food index increased by 11.3%, up by 0.71% points from rates recorded in January.

During the month, all major food groups which contribute to the Food sub-index increased at a faster pace during the month with the exception of the Potatoes, Yams and Other Tubers; and Sugar, jam, honey, chocolate and confectionery groups.

The “All Items less Farm Produce” or Core sub-index, increased at a faster pace in February as imported items as well as other domestic shocks resulted in ripple effects across many divisions that contribute to the Core. The index increased by 11.0% in February, roughly 2.2% points from rates recorded in January.

On a month-on-month basis, the Headline Index increased at a faster pace in February relative to January. The index increased by 2.3%, in February, roughly 1.4% points from rates recorded in January, as all divisions that contribute to the index increased with the exception of the Restaurants and Hotels division increasing at a slower pace.

In January, both the Urban and Rural indices recorded marked increases. The Urban index rose by 12.3% (year-on-year) from 9.7% recorded the month earlier, and the Rural index increased by 10.7% in February from 9.5% in January.

On a month-on-month basis, both the Urban and Rural indices increased at a faster pace, as the Urban index increased by 3.0% in February from 0.9% in January, while the Rural index increased by 1.8% from 0.9% in January.

The percentage change in the average composite CPI for the twelvemonth period ending in February 2016 over the average of the CPI for the previous twelve-month period was 9.4%, higher from 9.1% recorded in January.

The corresponding twelve month year-on-year average percentage change for the Urban index increased from 9.2% in January to 9.5% in February, while the corresponding Rural index also increased from 9.0% in January to 9.2% in Febuary.


Food Index

Imported food items as well as other necessary inputs to producing key local stapels such as bread continue to drive the food index higher. The Food index increased by 11.3% (Year-on-year) 0.7% points higher from rates recorded in January. The highest price increases were recorded in the Fish, Vegetables and Bread and Cereals groups for the second consecutive month.

On a month-on-month basis, the Food sub-index increased by 1.4% in February, 0.45% points higher from rates recorded in January. All groups which contribute to the Food Sub-index increased at a faster pace, with the exceptions of the Potatoes, Yams and Other Tubers; Sugar, jam, honey, chocolate and confectionery; and Milk, Eggs and Cheese groups.

The average annual rate of change of the Food sub-index for the twelve-month period ending in February 2016 over the previous twelve month average was 10.2%, 0.2%points from the average annual rate of change recorded in January (10.0%).

All Items less Farm Produce

The “All items less Farm Produce” or Core sub-index, which excludes the prices of volatile agricultural produce increased at a faster pace in February. The index increased by 11.0% during the month, 2.2% points from 8.8% in January as all key divisions which contribute to the index increased at a faster pace with the exception of the Restaurants and Hotels division.

On a month-on-month basis, the Core Sub-index increased at a faster pace in February, increasing by 2.7% from 0.8% in January. In February, the highest price increases were recorded in the Electricity, Books and Stationery groups, and Liquid Fuels groups.

The average twelve month annual rate of rise of the index was recorded at 8.7% for the twelvemonth period ending in February 2016, 0.3% points higher from the twelve month rate of change recorded in January.

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