LATEST Consumer Price Index report, CPI, released by the National Bureau of Statistics, NBS, on Friday revealed that Nigeria’s inflation rose by 15.75 per cent year-on-year in December 2020.
According to the report, the increase is 0.86 per cent points higher than the rate recorded in November 2020 (14.89) per cent.
The increase showed that this is the highest rate recorded in three years.
Increases were recorded in all COICOP divisions that yielded the headline index.
“On month-on-month basis, the headline index increased by 1.61 per cent in December 2020. This 0.01 per cent rate higher than the rate recorded in November 2020 (1.60 per cent).
“The percentage change in the average composite CPI for the twelve months period ending December 2020 over the average of the CPI for the previous twelve months period was 13.25 per cent, representing a 0.33 per cent point increase over 12.92 per cent recorded in November 2020.
“The urban inflation rate increased by 16.33 per cent (year-on-year) in December 2020 from 15.47 per cent recorded in November 2020, while the rural inflation rate increased by 15.20 per cent in December 2020 from 14.33 per cent in November 2020.
“On a month-on-month basis, the urban index rose by 1.65 per cent in December 2020, same as the rate recorded in November 2020, while the rural index also rose by 1.58 per cent in December 2020, up by 0.02 per cent above the rate that was recorded in November 2020 (1.56 per cent).
“The corresponding twelve-month year-on-year average percentage change for the urban index is 13.86 per cent in December 2020. This is higher than 13.55 per cent reported in November 2020, while the corresponding rural inflation rate in December 2020 was 12.67 per cent compared to 12.35 per cent recorded in November 2020,” it said.
The composite food index rose by 19.56 per cent in December 2020 compared to 18.30 per cent in November 2020.
This rise in the food index, the report said, was caused by increases in prices of bread and cereals, potatoes, yam and other tubers, meat, fruits, vegetable, fish and oils and fats.
“On month-on-month basis, the food sub-index increased by 2.05 per cent in December 2020, up by 0.01 per cent points from 2.04 per cent recorded in November 2020.
“The average annual rate of change of the food sub-index for the twelve-month period ending December 2020 over the previous twelve-month average was 16.17 per cent, 0.42 per cent points from the average annual rate of change recorded in November 2020 (15.75) per cent,” it stated.
The ‘all items less farm produce’ or core inflation, which excludes the prices of volatile agricultural produce stood at 11.37 per cent in December 2020, up by 0.32 per cent when compared with 11.05 per cent recorded in November 2020.
“On month-on-month basis, the core sub-index increased by 1.10 per cent in December 2020. This was up by 0.39 per cent when compared with 0.71 per cent recorded in November 2020.
“The highest increases were recorded in prices of passenger transport by air, medical services, hospital services, shoes and other footwear, passenger transport by road, miscellaneous services relating to the dwelling, hairdressing salons and personal grooming establishments, repair of furniture, vehicle spare parts, pharmaceutical products, motor cars, maintenance and repair of personal transport equipment, paramedical services, motor cycle, dental services and bicycles.
“The average 12-month annual rate of change of the index was 10.31 per cent for the twelve-month period ending December 2020; this is 0.17 per cent points higher than 10.14 per cent recorded in November 2020,” it noted.
In analysing price movements under this section, note that the CPI is weighted by consumption expenditure patterns which differ across states.
Accordingly, the weight assigned to a particular food or non-food item may differ from state to state making interstate comparisons of consumption basket inadvisable and potentially misleading.
“In December 2020, all items inflation on year on year basis was highest in Bauchi (19.85 per cent), Edo (18.15 per cent) and Kogi (18.40 per cent), while Lagos (14.05 per cent), Kwara (13.91 per cent) and Abia (13.30 per cent) recorded the slowest rise in headline year-on-year inflation.
“On month on month basis however, December 2020 all items inflation was highest in Nasarawa (2.30 per cent), Gombe (2.20 per cent) and Akwa Ibom (2.16 per cent), while Ekiti (0.87 per cent), River (0.67 per cent) and Ebonyi (0.61 per cent) recorded the slowest rise in headline month on month inflation.
“In December 2020, food inflation on a year on year basis was highest in Edo (24.14 per cent), Kogi (23.14 per cent) and Sokoto (22.24 per cent), while Bauchi (16.53 per cent), Abia (16.04 per cent) and Nasarawa (15.71 per cent) recorded the slowest rise.
“On month on month basis however, December 2020 food inflation was highest in Edo (3.68 per cent), Benin (3.48 per cent) and Gombe (3.00 per cent), while River (0.93 per cent), Osun (0.59 per cent) and Ekiti (0.24 per cent) recorded the slowest rise,” it added.
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