While Nigeria’s annual inflation rate rose for the seventh consecutive month to 20.52 percent in August 2022, the latest data from Nigeria’s National Bureau of Statistics showed that the month-on-month rate decreased from 1.82 percent to 1.77 percent. . Depreciation of the local currency, disruption of food supply and increase in production costs are said to be the reasons for the recent increase.
Currency depreciation driving inflation
According to the latest data from the Nigerian National Bureau of Statistics (NBS), the West African country’s inflation rate for the month of August 2022 rose by 20.52 percent. The final rate is 3.51 percent higher than the 17.01 percent recorded in August 2021.
With this latest development, Nigeria has now seen its seventh consecutive month of year-on-year (YoY) inflation. According to the statistics, one of the reasons for the YOY increase in inflation is the depreciation of the local currency.
According to Bitcoin.com News, the Nigerian currency has hit a new low against the US dollar at the end of July 2022. While analysts have blamed the country’s central bank for their role in weakening the local currency, some economists argue that it is still ongoing. Shortage of foreign exchange is mainly responsible.
In addition to the currency depreciation, food supply disruptions and general product price hikes were other factors contributing to the YOY increase in inflation, the NBS said.
Month-on-month inflation has decreased
However, despite the latest YoY inflation in the country, the NBS data indicated that the month-on-month inflation rate decreased slightly to 1.77 percent in August 2022 from 1.82 percent in July 2022. Regarding the country’s consumer price index (CPI), the statistics agency said:
The average CPI percentage change for the twelve months ending August 2022 showed an increase of 0.47 percent compared to the previous twelve month average of 17.07 percent, compared to 16.60 percent recorded in August 2021.
Meanwhile, NBS data shows that YOY inflation was slightly higher in urban Nigeria (20.95%) than rural Nigeria (20.12%). Month-on-month rural inflation declined by 0.06% to 1.75% in August 2022 from 1.81% in July 2022, while urban inflation declined by just 0.03%.
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