Inflation Rate Rises to 8.3% as Food Prices Increase

The National Bureau of Statistics on Monday released the Consumer Price Index for the month of July, explaining that the increase in food prices had pushed up the nation’s inflation rate to 8.3%. this is an increase by 0.1% point over the 8.2% recorded in June.

The report states that this is the fifth consecutive month of year-on-year increase in the headline index.

After a decline of the inflation index in January, prices had continued to increase by 0.1% points (year-on-year) each month between February and July.

According to the report, the highest price increase based on a month-on-month basis was recorded in bread and cereals, fruit and meat groups.

It said, “In July 2014, the CPI, which measures inflation, edged higher from the previous month. Prices rose by 8.3% (year-on-year), up by 0.1% points from 8.2% recorded in June.

“This is the fifth consecutive month of year-on-year increases in the headline index. The faster pace of price increases recorded in the headline index was as a result of an increase in multiple divisions that contribute to the Headline index.”

The increases in urban prices on a month-on-month basis eased as Urban Headline index in July increased by 0.70%, indicating 0.1% points lower from that of June.

Also, it was noted by NBS that the rural prices also exhibited the same trend over the period, increasing by 8.1% from 8% in the previous month.

The Rural All-items Index rose at a slower pace by 0.60% in July, decreasing from 0.74% in June.

The Governor, Central Bank of Nigeria, Mr. Godwin Emefiele, had last month identified pressure from food/core inflation and the risks that could emanate from the likely increase in aggregate spending in the run-up to the 2015 general elections as pressures points to monetary policy stability.

He had said, “We are monitoring the situation, monitoring the liquidity situation in the money market; monitor the spending of Nigerians and the government to the run up to the elections.

“And as we begin to see that the macro economic variables are moving in the direction that we expect, you will begin to see the reversal in interest rates in the direction where we want to be.”