Nigeria’s inflation rate has dropped. According to the consumer price index report released by the National Bureau of Statistics (NBS) on Monday May 17, 2021, the inflation rate recorded a slight drop in the month ending April 2021, shedding 0.05 per cent to close at 18.12 per cent in the month under review.
In the preceding month of March, the country’s inflation was 18.7 per cent.
According to the NBS inflation report, the Consumer Price Index, which measures inflation increased by 18.12 per cent (year-on-year) in April 2021.
“This is 0.05 per cent points lower than the rate recorded in March 2021 (18.17 per cent),” the bureau said.
The 0.05 per cent drop in April 2021 was the first time the country’s inflation rate would fall in about 20 months, as the last time it fell was in 2019 when the CPI shed 0.06 per cent, falling from 11.08 per cent in July to 11.02 in August.
The NBS in its report stated that increases were recorded in all Classification of Individual Consumption by Purpose divisions that yielded the headline index.
On month-on-month basis, the headline index increased by 0.97 per cent in April 2021, this was 0.59 per cent rate lower than the rate recorded in March 2021 (1.56 per cent).
The percentage change in the average composite CPI for the 12 months period ending April 2021 over the average of the CPI for the previous 12 months period was 15.04 per cent, showing 0.48 per cent point from 14.55 per cent recorded in March 2021.
Urban inflation rate
The urban inflation rate increased by 18.68 per cent year-on-year in April 2021 from 18.76 per cent recorded in March 2021, while the rural inflation rate increased by 17.57 per cent in April 2021 from 17.60 per cent in March 2021.
On a month-on-month basis, the urban index rose by 0.99 per cent in April 2021, down by 0.61 the rate recorded in March 2021 (1.60 per cent).
The rural index also rose by 0.95 per cent in April 2021, down by 0.57 the rate that was recorded in March 2021(1.52 per cent).
The corresponding 12 month year-on-year average percentage change for the urban index was 15.63 per cent in April 2021.
This was higher than 15.15 per cent reported in March 2021, while the corresponding rural inflation rate in April 2021 was 14.48 per cent compared to 13.99 per cent recorded in March 2021.
Nigeria’s annual inflation climbed to a more than four-year high in March, rising 82 basis points from a month earlier to 18.17%.
Galloping food prices have heaped pressure on households in Africa’s largest economy, which is also facing a shrinking labour market and stagnant growth at a time of mounting insecurity.
Food prices rose 1.16 percentage points from the previous month to 22.95% in March, the National Bureau of Statistics (NBS) said. Inflation hit 18.72% in January 2017.
Cut on import duty
Nigeria’s government in March said it will cut import duty on tractors and mass transit vehicles to try to reduce transportation costs and tackle high food prices that are contributing to the double-digit inflation.
President Muhammadu Buhari has made investment in rail and road a focus of his administration’s drive to kick-start growth, but falls in public revenue – linked to lower oil prices due to the global coronavirus pandemic – have checked his ambitions.
Nigeria, Africa’s most populous country, went into recession – its second since 2016 – in the third quarter of 2020, as the coronavirus pandemic caused oil prices to crash, slashing state revenue, creating large financing needs and weakened the naira.