The Nigerian Bureau of Statistics has released the consumer price index report for August 2019.
The consumer price index, (CPI) which measures inflation increased by 11.02% (year-on-year) in August 2019. According to the NBS report, This is 0.06% points lower than the rate recorded in July 2019 (11.08%).
The urban inflation rate increased by 11.48% (year-on-year) in August 2019 from 11.43% recorded in July 2019, while the rural inflation rate increased by 10.61% in August 2019 from 10.64% in July 2019.
The composite food index rose by 13.17% in August 2019 compared to 13.39% in July 2019. This rise in the food index was caused by increases in prices of Oils and fats, Meat, Bread and cereals, Potatoes, yam, and other tubers and Fish. The average annual rate of change of the Food sub-index for the twelve months ending August 2019over the previous twelve-month average was 13.458%, 0.002% points from the average annual rate of change recorded in July 2019 (13.460%).
ALL ITEMS LESS FARM PRODUCE OR CORE INFLATION
Core inflation, which excludes the prices of volatile agricultural produce stood at 8.68% in August 2019, down by 0.12% when compared with 8.80% recorded in July 2019. According to the report the highest increases were recorded in prices of Cleaning, Repair and hire of clothing, Repair of household appliances, Hospital services, Glassware, tableware, and household utensils, Passenger transport by air and repair and hire of footwear.
CPI STATE ANALYSIS
NBS reported that in August 2019, all items inflation on year on year basis was highest in Kebbi (14.97%), Kano (13.24%) and Bauchi (13.00%), while Cross River (8.97%), Delta (8.63%) and Kwara (8.32%) recorded the slowest rise in headline Year on Year inflation. On month on month basis, however, August 2019 all items inflation was highest in Ebonyi (1.59%), Bayelsa (1.59%) and Ogun(1.52%), while Niger (0.29%), Kwara (0.28%) recorded the slowest rise with Kogi recording price deflation or negative inflation.
According to the report, In August 2019, food inflation on a year on year basis was highest in Kebbi (17.20%), Kano (16.08%) and Adamawa (15.95%), while Bayelsa (10.22%), Katsina (9.64%) and Kogi (8.97%) recorded the slowest rise. On month on month basis, however, August 2019 food inflation was highest in Akwa Ibom (2.56%),Enugu(2.37%) and Ogun (2.17%), while Kogi (0.09%), Benue (0.05%) and Delta (0.03%) recorded the slowest rise.
The NBS Consumer Price Index report for August 2019 highlighted the following keynotes
- In August 2019, all major indices slowed except urban inflation year on year.
- Disinflation continued in August 2019 despite several pronouncements regarding restrictions on the import of some food items, minimum wage, and the recent border closures. It is important to note that concerning the closure of the border, the border was only closed 20 August 2019 with only 11 days of 31days for any significant impact to be felt either way on prices.
- The inflation rate is also the average price for the whole month and not only the price of goods and services in the last few days of the month.
- The harvest season and existing weak consumer demand and their natural effect to slow down food and other prices will also play a major role in determining the direction of inflation.