July 22, 2024

In the latest inflation report released by the National Bureau of Statistics (NBS), Nigeria’s inflation rate for January 2024 has surged to 29.90%, marking a significant increase from the 28.92% recorded in the preceding month.

The data reveals a notable uptick in the headline inflation rate for January 2024 by 0.98% points when juxtaposed with December 2023’s figures. 

Delving into a year-on-year comparison, the inflation rate for January 2023 stood at 21.82%, showcasing a considerable leap of 8.08% points by January 2024, underscoring an escalated headline inflation rate over the same period in the preceding year. 

Moreover, a closer examination on a month-on-month basis illustrates that the headline inflation rate for January 2024 ascended to 2.64%, outpacing the 2.29% observed in December 2023 by 0.35% points.

This increment elucidates a heightened rise in the average price level for January 2024 relative to the increase noted in December 2023, highlighting the growing inflationary pressures within the nation’s economy. 

  The NBS reports a significant surge in the food inflation rate for January 2024, reaching a year-on-year high of 35.41%. This marks a substantial 11.10%-point increase from the 24.32% observed in January 2023, highlighting a pronounced rise in the cost of food items. 

The key drivers of this inflationary pressure include notable price hikes in essential food commodities such as bread and cereals, potatoes, yams and other tubers, oils and fats, fish, meat, fruits, as well as coffee, tea, and cocoa. 

In a more granular month-on-month analysis, the food inflation rate for January 2024 escalated to 3.21%, which is 0.49% points above the rate recorded in December 2023 (2.72%). This increase can be attributed to the accelerated rate of price rises in potatoes, yams and other tubers, bread and cereals, fish, meat, tobacco, and vegetables. 

Moreover, examining the broader trend, the average annual rate of food inflation for the twelve months ending in January 2024 surged to 28.91%, representing a significant 7.38%-point increase from the 21.53% annual rate of change recorded in January 2023. This data underscores the escalating cost pressures within the food sector, affecting the overall inflationary landscape and impacting the cost of living for households across Nigeria. 

  The NBS delineates a marked increase in the Core inflation rate for January 2024, which ascended to 23.59% on a year-on-year basis. This represents a significant uplift of 4.71% points from the 18.88% noted in January 2023. The Core inflation metric, known for excluding the prices of volatile agricultural produce and energy, offers a glimpse into the underlying inflationary trends minus the external price shocks from these sectors. 

The inflationary pressures within this core category were most pronounced in the costs associated with passenger transport by road, medical services, actual and imputed rentals for housing, pharmaceutical products, accommodation services, and passenger transport by air, among others. These areas witnessed the highest price increases, reflecting the broad-based nature of inflationary pressures beyond food and energy sectors. 

On a month-on-month basis, the Core Inflation rate for January 2024 was recorded at 2.24%, marking an increase from the 1.82% observed in December 2023 by 0.42% points. This increment signifies a continued acceleration in the price levels of non-volatile and non-energy items as the month progressed. 

Furthermore, the analysis over a 12-month period ending in January 2024 reveals an average annual inflation rate of 21.15% for the core index, up by 4.74% points from the 16.41% recorded in January 2023. This uptrend underscores a sustained rise in the core inflation rate, highlighting persistent inflationary pressures in the segments of the economy unaffected by agricultural or energy price volatilities. 

  The latest data from the NBS unveils a significant year-on-year upsurge in the urban inflation rate for January 2024, which stood at 31.95%. This rate is a considerable 9.40% points increase from the 22.55% recorded in January 2023, pointing to a stark acceleration in inflation within urban centres. 

  • When delving into the month-on-month figures, the urban inflation rate in January 2024 escalated to 2.72%, marking a 0.30%-point rise over December 2023’s rate of 2.42%. This increment reflects a quicker pace of price increases in urban areas at the start of the year. 
  • Additionally, the corresponding twelve-month average for the urban inflation rate as of January 2024 was 27.01%, showcasing a 7.10%-point jump from the 19.91% reported in January 2023. This data signifies a notable elevation in the average price levels within urban locales over a year, underscoring the intensifying inflationary pressures that urban residents are grappling with. 


Rural inflation  

  • In rural inflation dynamics, the NBS report illuminates that January 2024 witnessed a rural inflation rate of 28.10% on a year-on-year basis. This figure marks a 6.97 percentage point ascent from the 21.13% noted in January 2023, signalling a substantial inflationary uptrend in rural locales over the period. 
  • On a month-on-month analysis, the rural inflation rate for January 2024 edged up to 2.57%, representing a 0.40 percentage point increase from the 2.17% registered in December 2023. This uptick underscores a more rapid inflationary pace in rural areas at the onset of the year. 
  • Furthermore, the twelve-month average rural inflation rate as of January 2024 stood at 23.85%, which is 5.01 percentage points higher than the 18.84% documented in January 2023. 
  • This statistic reflects a pronounced escalation in the average price levels within rural communities over the year, highlighting the sustained inflationary pressures that increasingly impact the cost of living in these areas. 

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