The prices of rice and garri skyrocketed by over 70 per cent between February 2016 and February 2017.
The selected food price watch data released yesterday by the National Bureau of Statistics (NBS) showed that the average prices of beans, beef, tinned milk, frozen chicken, onion, tomato and yam also recorded unprecedented leaps in the last one year.
This is even as the NBS reported in a separate report, also released yesterday, that Nigeria recorded first drop in inflation rate in 15 months as the rate slowed by 0.94 per cent from the 18.72 per cent recorded in January to 17.78 per cent in February 2017.
The Consumer Price Index, which measures inflation, indicated that the latest drop in inflation rate represents “the effects of slower rises in already high food and non-food prices and favourable base effects over 2016 prices.”
Daily Trust’s analysis of the selected food price watch data showed that the average price of local rice increased by 77.31 per cent in one year from N236.79 sold February last year to N306.29 per mudu as at February 2017.
According to analysts at Financial Derivatives Company (FDC), “This development came as no surprise as the markets were already anticipating a reversal in trend.”
They said Nigeria’s sub-Saharan African (SSA) peers such as Angola, Mozambique and Congo, reported a similar decline. Nigeria currently has the 7th highest inflation rate in SSA.
The data showed that the decline in the inflation rate of 0.94% was capped by increases in the food basket. The food index, which is relatively forex insensitive, edged up to 18.53% from 17.82% the previous month.
Month-on-month inflation also moved in the same direction with food index to 1.49% in February from 1.01% the previous month. Core inflation on the other hand, which is the inflationary trend less seasonality and anomalies, maintained its downward trend for the 3rd consecutive month.
They recommended a conscious effort to taper the level of waste in the power sector.
“Efforts by the presidency and the militants in the Niger Delta will help deter the level of militant activity on gas pipelines, thereby increasing the capacity for power generation.”
They said money supply will continue to be a central focus for the CBN, as an increase in narrow money without a corresponding increase in output will increase inflationary pressure in the country.
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