Nigeria witnessed a remarkable surge in inflation, reaching 24.08% in July 2023, marking a 129 basis-point increase compared to the previous month’s 22.79%.
This surge marks the sixth consecutive increase in the headline index for this year, as reported by the National Bureau of Statistics (NBS) in its recently released Consumer Price Index (CPI) report.
This substantial increase can be attributed to the complete removal of petrol subsidies and the unification/devaluation of the official exchange rate.
Notably, the month-on-month headline inflation rate for July stood at 2.89%, which was 0.76% higher than the rate recorded in June 2023 (2.13%).
The driving factors behind the year-on-year inflation were Food and non-alcoholic beverages (12.47%), housing water, electricity, gas, and other fuel (4.03%), and clothing and footwear (1.84%).
Food inflation experienced a significant rise, reaching 26.98% in July 2023, marking a 1.73% point increase from the previous month and a 4.97% point increase from the same period in 2022.
On a month-on-month basis, the Food inflation rate for July 2023 was 3.45%, 1.06% higher compared to June 2023 (2.4%).
The Core inflation rate, excluding volatile agricultural produce, stood at 20.47% in July 2023 on a year-on-year basis, reflecting a 4.41% increase from July 2022 (16.06%).
On a month-on-month basis, the Core inflation rate increased from 1.77% in June 2023 to 2.11% in July 2023.
In terms of regional variation, Kogi (28.45%), Lagos (27.30%), and Ondo (26.83%) experienced the highest year-on-year inflation rates, while Borno (20.71%), Jigawa (20.85%), and Sokoto (20.92%) recorded the slowest rises. Kogi State also recorded the highest food inflation at 34.53% in July, followed by Lagos (32.52%), and Bayelsa (31.31%).
The removal of fuel subsidies and exchange rate unification have had a substantial impact on inflation, resulting in an escalation of food, energy, and transport costs.
Transportation expenses saw a nationwide spike, largely attributed to the significant rise in petrol prices and the unification and devaluation of the official exchange rate.
The Nigerian Naira’s exchange rate surpassed N740 per US Dollar, reflecting a substantial devaluation from the previous average of N460 per US Dollar.
This data showcases a clear reflection of the ongoing economic trends and challenges in the country.
