Data released on Monday indicated that price increases for food, fuel, and clothes drove annual inflation in Nigeria to its highest rate since 2005 in July.
According to the NBS, annual inflation has increased for six consecutive months, reaching 19.64% in July after reaching 18.60% in June.
According to NBS figures, inflation in July hit a new peak not seen since at least the beginning of 2009.
According to Refinitiv data, it was the highest rate since September 2005, when it hit 24.32%.
Since 2016, Africa’s largest economy has experienced double-digit inflation, which has been fueled in part by a decline in the value of the naira.
Bread and cereals, potatoes, yam, meat, fish, oil, and other foods contributed to a 22.02% annual increase in food costs in July.
Prices for gas, liquid and solid fuel, transportation by road and air, apparel and clothing rental all contributed to the 16.26% year-over-year increase in core inflation, which does not include the cost of food.
The current president, Muhammadu Buhari, is stepping down in February, and the country will hold a national election in which voters will select a new president.
Since July 2021, when the central bank halted FX sales to retail currency traders to reduce pressure on reserves and boost the official market, the naira has been sinking on the parallel market due to a scarcity of foreign currency.
As a result, consumer spending shifted to the black market, where the currency is freely traded.
Policymakers have hypothesised that structural factors, particularly imports, are behind the economy’s continued vulnerability to inflationary pressures.
In a research report, analysts at Capital Economics predicted that Nigeria’s inflation was near its peak and would remain high for the foreseeable future.
They expected the central bank to raise interest rates again at its September meeting.