The latest Report released On Friday by the National Bureau of Statistics NBS indicates that in August 2023, the headline inflation rate increased to 25.80% relative to the July 2023 headline inflation rate which was 24.08%.
NBS noted that looking at the movement, the August 2023 headline inflation rate shows an increase of 1.72% points when compared to the July 2023 headline inflation rate.
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On a year-on-year basis, the headline inflation rate was 5.27% points higher compared to the rate recorded in August 2022, which was 20.52%. This shows that the headline inflation rate (year-on-year basis) increased in August 2023 when compared to the same month in the preceding year (i.e., August 2022).
Similarly, on a month-on-month basis, the headline inflation rate in August 2023 was 3.18%, which was 0.29% points higher than the rate recorded in July 2023 (2.89%).
This means that in August 2023, on average, the general price level was 0.29% higher relative to July 2023.
The percentage change in the average CPI for the twelve-month period ending August 2023 over the average of the CPI for the previous twelve-month period was 22.38%, showing a 5.31% increase compared to 17.07% recorded in August 2022.
On a year-on-year basis, in August 2023, the Urban inflation rate was 27.69%, this was 6.73% points higher compared to the 20.95% recorded in August 2022. On a month-on-month basis, the Urban inflation rate was 3.29% in August 2023, this was 0.24% points higher compared to July 2023 (3.05%). The corresponding twelve-month average for the Urban inflation rate was 23.46% in August 2023. This was 5.87% points higher compared to the 17.59% reported in August 2022.
The Rural inflation rate in August 2023 was 24.10% on a year on year basis; this was 3.98% points higher compared to the 20.12% recorded in August 2022. On a month-on-month basis, the Rural inflation rate in August 2023 was 3.08%, up by 0.34% points compared to July 2023 (2.74%).
The corresponding twelve-month average for the Rural inflation rate in August 2023 was 21.39%. This was 4.81% points higher compared to the 16.58% recorded in August 2022.
The Food inflation rate in August 2023 was 29.34% on a year-on-year basis, which was 6.22% points higher compared to the rate recorded in August 2022 (23.12%).
The rise in Food inflation on a year-on-year basis was caused by increases in prices of Oil and fat, Bread and cereals, Fish, Fruit, Meat, Vegetables and Potatoes, Yam and other Tubers, Vegetable,Milk,Cheese and Eggs.
On a month-on-month basis, the Food inflation rate in August 2023 was 3.87%, this was 0.41% points higher compared to the rate recorded in July 2023 (3.45%).
The rise in Food inflation on a month-on-month basis was caused by increases in prices of Bread and cereals, Potatoes, Yam and other tubers, Fish, Oil and Fat, Coffee, Tea, and Cocoa.
The average annual rate of Food inflation for the twelve months ending August 2023 over the previous twelve-month average was 25.01%, which was 5.99% points increase from the average annual rate of change recorded in August 2022 (19.02%).
Before July, “all items less farm produces” is referred to as the Core inflation. This was be cause the prices of items that constitute energy were regulated by the government e.g., Petroleum Motor Spirit (PMS). Due to the deregulation of the sector and the removal of the fuel subsidy, all the items that constitute energy are now determined by market forces and hence their prices are termed volatiles. Therefore, Core inflation is referred to as all items index less farm produces and energy.
The “All items less farm produces and energy” or Core inflation, which excludes the prices of volatile agricultural produces and energy stood at 21.15% in August 2023 on a year-on-year basis; up by 4.03% points when compared to the 17.12% recorded in August 2022.
The highest increases were recorded in prices of Passenger Transport by Air, Passenger Transport by Road, Medical Services, Vehicle Spare parts, Maintenance, and repair of personal transport equipment etc. On a month on month basis, the Core Inflation rate was 2.18% in August 2023. It stood at 2.11% in July 2023, up by 0.07%. The average twelve month annual inflation rate was 19.18% for the twelve months ending August 2023; this was 4.38% points higher than the 14.80% recorded in August 2022.
In analysing price movements under this section, it should be noted that CPI is weighted by consumption expenditure patterns which differ across States and locations.
Accordingly, the weight assigned to a particular Food or Non-Food item may differ from State to State making interstate comparisons of consumption basket inadvisable and potentially misleading.
In August 2023, all items inflation rate on a year-on-year basis was highest in Kogi (31.50%), Lagos (29.17%), and Rivers (29.06%), while Sokoto (20.91%), Borno (21.77%) and Nasarawa (22.25%) recorded the slowest rise in headline inflation on a year-on-year basis.
On a month on month basis, however, August 2023 recorded the highest increases in Kwara (6.07%), Osun (4.36%), and Kogi (4.35%), while Sokoto (1.38%), Borno (1.73%) and Ogun (1.89%) recorded the slowest rise on month-on-month inflation.
In August 2023, Food inflation on a year-on-year basis was highest in Kogi (38.84%), Lagos (36.04%), and Kwara (35.33%), while Sokoto (20.09%), Nasarawa (24.35%) and Jigawa (24.53%) recorded the slowest rise in Food inflation on a year-on-year basis. On a month on-month basis, however, August 2023 Food inflation was highest in Rivers (7.12%), Kwara (5.89%), and Kogi (5.80%), while Sokoto (0.50%), Abuja (1.30%) and Niger (1.40%) recorded the slowest rise in Food inflation on a month-on-month basis.
