Nigeria's annual inflation rate surged to 24.08% in July, up from 22.79% the previous month, according to the country's National Bureau of Statistics. This marks the seventh consecutive month of rising inflation and the highest level since December when it reached 21.3%.
Food Inflation on the Rise
The report also reveals that food inflation has increased to 26.98% in July, compared to 25.25% in the previous month. The Central Bank of Nigeria attributes this spike in food inflation to rising prices across the board for food and edible oils. Additionally, factors such as security concerns in food-producing areas, escalating transportation costs, and insufficient public infrastructure have all contributed to the surge in both food and core inflation.
Escalating Costs in Multiple Sectors
The cost of diesel oil has nearly tripled, with prices now ranging from 900 to 950 Nigerian naira ($1.17 to $1.23) per liter. This is a significant jump from last year when the price was between NGN350 and NGN400 per liter ($0.45 to $0.52). Furthermore, petrol prices have more than doubled since the removal of a subsidy on petroleum products at the end of May. As a result, not only has the cost of food increased, but transportation, housing, and other essential goods and services have also experienced sharp price hikes.
Impact on Manufacturing Sector
In addition to the aforementioned challenges, the Nigerian economist highlighted the consequences of the central bank's decision to transition to a unified and market-determined exchange rate. This move has led to increased costs in the manufacturing sector, causing employment concerns.
Overall, Nigeria's economy is grappling with soaring inflation rates that continue to impact various sectors of the economy, now reaching its highest point in months.
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