Nigeria’s inflation rate in the month of December 2021 rose to 15.63% from 15.4% recorded in November 2021, after 8 months of consecutive decline. This is according to the consumer price index report, released by the National Bureau of Statistics (NBS). Nigeria’s inflation rate had been on a steady decline in the past 8 months since April 2021, moderating from the highs recorded in the previous year. However, the rate had just back-pedalled with an uptick in December 2021. On month-on-month basis, the headline index increased by 1.82% in December 2021, this is 0.74% points higher than the rate recorded in November 2021 (1.08%).
Meanwhile, urban inflation rate increased by 16.17% (year-on-year) in December 2021 from 16.33% recorded in December 2020, while the rural inflation rate increased by 15.11% in December 2021 from 15.20% in December 2020.
Food inflation, which accounts for all volatile agricultural produce increase by 0.16% points to 17.37% in December 2021 compared to 17.21% recorded in the previous month. On month-on-month basis, the food sub-index increased by 2.19% in December 2021, up by 1.12% points from 1.07% recorded in November 2021. This rise in the food sub-index was caused by increases in prices of Bread and cereals, Food product, Meat, Fish, Potatoes, yam and other tubers, soft drinks and fruit.
The average annual rate of change of the Food sub-index for the twelve-month period ending December 2021 over the previous twelve-month average was 20.4%, 0.22% points lower from the average annual rate of change recorded in November 2021 The ‘’All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 13.87% in December 2021, up by 2.50 percent when compared with 11.37% recorded in December 2020.
On month-on-month basis, the core sub-index increased by 1.12% in December 2021. This was down by 0.13$ when compared with 1.26% recorded in November 2021. On the other hand, the highest increases were recorded in prices of Gas, Liquid fuel, Wine, Actual and imputed rentals for housing, Narcotics, Tobacco, Spirit, Cleaning, repair and hire of clothing, Garments, Shoes and other footwear and clothing materials, other articles of clothing and clothing accessories.
In December 2021, all items inflation on year-on-year basis was highest in Ebonyi (18.71%), Kogi (18.37%), and Bauchi (17.81%), while Kwara (12.32, Edo (13.46%) and%) Cross River (13.93%) recorded the slowest rise in headline Year on Year inflation. In December 2021, food inflation on a year-on-year basis was highest in Kogi, (22.82%), Enugu (20.65%) and Lagos (20.27%), while Edo (13.24%), Kaduna (13.53%) and Sokoto (14.82%) recorded the slowest rise.
The increase in Nigeria’s inflation rate implies that the purchasing power of Nigerians is being eroded and was worse during the Christmas and New year celebrations as demand for products surged across the country.