Nigeria Inflation Slightly Drops to 15.91% in October

By Dipo Olowookere

Inflation in Nigeria in the month of October 2017 marginally moderated to 15.91 percent (year-on-year) from 15.98 percent in September 2017, representing a 0.07 percent margin.

This is according to the data released by the National Bureau of Statistics (NBS) on Tuesday, November 15, 2017.

In the data obtained by Business Post, the drop in the inflation rate for last month is the ninth consecutive disinflation (slowdown in the inflation rate though still positive) in headline year-on-year inflation since January 2017.

According to the stats office, while average headline year-on-year inflation for the first five months of the year (January to May 2017) stood at 17.45 percent, average headline year-on-year inflation for the next five months of the year (June to October 2017), stood at 16.01 percent, indicating disinflation from June to date, compared to from January to May 2017.

On a month-on-month basis, the headline index increased by 0.76 percent in October 2017, 0.02 percent points lower from the rate of 0.78 percent recorded in September. This represents the fifth consecutive month-on-month contraction in headline inflation since May 2017.

While average headline month-on-month inflation for the first five months of the year (January to May 2017) stood at 1.54 percent, average headline month-on-month inflation for the next five months of the year (June to October 2017), stood at 1.06 percent indicating disinflation from June to date compared to from January to May 2017.

This indicates that while prices have remained high in 2017, they have tended to slow down their pace of increase since May 2017 both on a year-on-year and month-on-month basis.

The percentage change in the average composite CPI for the twelve-month period ending in October 2017 over the average of the CPI for the previous twelve-month period, which has also trended downwards since May 2017 was 16.97 percent, showing 0.2 percent point lower from 17.17 percent recorded in September 2017.

The Urban index rose by 16.19 percent (year-on-year) in October2017, up by 0.01 percent point from 16.18 percent recorded in September and the Rural index increased by 15.67 percent in October 2017 down from 15.81 percent in September 2017.

On month-on-month basis, the urban index rose by 0.82 percent in October 2017, down from 0.84 percent recorded in August, while the rural index rose by 0.72 percent in October 2017, down from 0.74 percent in September.

The corresponding twelve-month year-on-year average percentage change for the urban index was 17.57 percent in October. This was less than 17.87 percent reported in September 2017, while the corresponding rural inflation rate in October was 16.41 percent compared to 16.52 percent recorded in September 2017.

Also, high food price and food price pressure continued into September though generally at a slower pace.

The Food Index increased by 20.31 percent (year-on-year) in October, down marginally by 0.01 percent points from the rate recorded in September (20.32 percent).

While average year on year food inflation for the first five months of the year (January to May 2017) stood at 18.67 percent, average year on year food inflation for the next five months of the year (June to October 2017), was higher at 20.22 percent indicating higher food price inflation on average in the second five months of the year compared to the first five months.

On a month-on-month basis, the Food sub-index increased by 0.85 percent in October, down from 0.87 percent recorded in August.

This represents the fifth consecutive disinflation in month on month inflation since a 2017 high of 2.57 percent in May 2017. October 2017 also represents the lowest recorded month on month inflation since September 2016.

While average month on month food inflation for the first five months of the year (January to May 2017) stood at 2.01 percent, average month on month food inflation for the next five months of the year (June to October 2017), stood at 1.27 percent indicating a general slow-down in the rise in food prices from June to date compared to from January to May 2017, though the rate of price increases has remained generally higher on a year on year basis.

The average annual rate of change of the Food sub-index for the twelve-month period ending in October 2017 over the previous twelve month average was 19.14 percent, 0.26 percent points from the average annual rate of change recorded in September (18.88) percent

The rise in the food index, in October 2017 was caused by increases in prices of bread and cereals, meats, oils and fats, coffee tea and cocoa, milk cheese and eggs vegetables and fish.