Nigeria’s inflation declines but market prices still high

Inflation declined by 0.13 percent in December 2022, but this has an insignificant impact on prices of goods and services.

In Nigeria, the Consumer Price Index (CPI) measures changes in the prices paid by consumers for goods and services. The CPI for all items on a year-on-year basis declined by 0.13 percent in December 2022.

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Analysis of the data provided by the National Bureau of Statistics (NBS) shows there was a decrease in the prices of goods compared with those of the preceding month. 

Inflation was 21.47 percent in November 2022 and declined to 21.34 percent in December, representing a 0.13 percent reduction.

However, a comparison of year-on-year inflation rates between December 2021 and 2022 shows that in December 2022, there was a 5.72 percent increase compared to the 15.63 percent rate recorded in December 2021.

Highest inflation in 10 years

Dataphyte analysis has shown that despite the decrease in inflation rate in December 2022, it is the highest in 10 years. Between 2012-2022, the inflation rate rose by 9.34 percent. 

This inflation rate has affected the cost of livelihood, health, furniture, housing, clothing, and other commodities. 

Market prices remain high

According to Dataphyte checks, market prices of goods are still high. A 50kg bag of local rise sells between N37,000 and N40,000 in Abuja markets, with a tin of milk going for N350 – same for November and December 2022. The price of a carton of noodles (small size) is N4000 in Lagos and Abuja markets, a crate of eggs selling at N2,200 in most markets.

Hoever, prices of beans and yam are decling due to seasonal issues.

The Financial Derivatives Company Limited, a financial advissory firm, said: “After months of stubborn inflation, which hit a 17-year high in November 2022, glimmers of hope seem to be emerging due to seasonalities. Our survey shows that food inflation will ease by 0.17% to 23.95% due to falling food prices as a result of the harvest season. Our estimates also show that the pace of acceleration in core inflation has begun to taper. This is partially due to the stronger naira, consumer price resistance, and declining global prices.”

In a statement made available to Dataphyte, Chinyere Almona, Director-General, Lagos Chamber of Commerce and Industry, said the base factors that might continue to drive the major economic indicators in the country included the rising inflation rate, tight monetary policies, an unstable currency, foreign exchange scarcity, debt burden, currency management, food supply disruptions, exchange rate volatility, and
election spending.