Thursday, March 16, 2023

Inflation in Nigeria quickened in February

Nigeria's inflation picked up again in February, hitting 21.91% in annual terms from 21.82% in January, the statistics agency said on Wednesday.

Inflation rose in Africa's biggest economy for 10 straight months last year, prompting a string of interest rate hikes from the central bank. The pace of price increases dipped in December but started to rise again in January.

Food inflation, which accounts for the bulk of Nigeria's inflation basket, rose to 24.35% in February from 24.32% in January.

High inflation, weak economic growth and mounting insecurity were major issues at last month's election, where the ruling party's candidate won in a poll marred by low voter turnout, logistical failures and disruption to voting in some places.

"The rise in food inflation was caused by increases in prices of oil and fat, bread and cereals, potatoes, yam ... fish, fruits, meat, vegetable and food products," the National Bureau of Statistics said in its inflation report.

Policymakers have linked inflationary pressures to Nigeria's infrastructure problems and the fact that a lot of items people consume are imported.

Central Bank of Nigeria (CBN) Governor Godwin Emefiele has said the bank will maintain a hawkish stance on rates if inflation remains elevated. The bank holds a monetary policy meeting next Tuesday.

The CBN hiked its key interest rate to 17.5% in January, meaning there have been 600 basis points of rate hikes since last May.

By Chijioke Ohuocha, Reuters

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