Rising basic costs of living push inflation to 22.41%

A general increase in costs of basic items pushed Nigeria’s inflation rate for the fifth consecutive month to a new 17-year high of 22.41 per cent in May 2023.

The latest Consumer Price Index (CPI) and Inflation Report released yesterday by the National Bureau of Statistics (NBS) showed continuing increase in costs of basic living items such as food, gas and other items nudged inflation rate from 22.22 per cent in April 2023 to 22.41 per cent in May 2023, an increase of 0.19 per cent.

The general inflationary trend was particularly driven by a higher costs of food items, with the food inflation rate rising to 24.82 per cent in May 2023, its highest since September 2005.

Most data showed persistent increases in items, whether compared on a yearly or monthly basis. The inflationary trend also cut across locations, from urban to rural. This implied further erosion of disposable incomes and a tightening in general living standards.

According to the report, on a year-on-year comparison, the latest headline inflation rate was 4.70 percentage points higher compared to 17.71 per cent recorded in May 2022. However, on a month-on-month basis, the headline inflation rose by three basis points to 1.94 per cent in May 2023 as against 1.91 per cent in April 2023, higher than average year-to-date rate of 1.86 per cent.

A component analysis showed broad increase in all food items with farm produce rising by 40 basis points to 24.24 per cent in May 2023 compared with comparative period of 2022; processed foods rose by 16 basis points to 25.00 per cent compared with same period in 2022.

Notably, on a monthly trajectory, food prices rose by six basis points from 2.13 per cent in April 2023 to 2.19 per cent in May 2023, the highest in 17 months.On a state by state basis, the NBS report showed that, in May 2023, all items inflation rate on a year-on-year basis was highest in Ondo, 25.84 per cent; Kogi, 25.70 per cent and Rivers, with 25.02 per cent. On the other hand, Taraba, 19.55 per cent; Sokoto, 19.56 per cent and Plateau, with 19.89 per cent recorded the slowest rise in headline inflation on year-on-year basis.