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Fuel Subsidy Removal, Food Prices Push Inflation Up to 27.33%

The National Bureau of Statistics (NBS) reported a significant rise in the Consumer Price Index (CPI), a measure of price changes for goods and services. In October, it surged to 27.33%, marking a 0.61% increase from the previous month’s 26.72%.

Dr. Isa AbdulMumin, the spokesperson for the Central Bank of Nigeria (CBN), expressed optimism about the CBN’s efforts in tightening rates and reforming the money market, seeing the October inflation rate as a positive indicator.

Breaking down the report, food prices increased by 31.52% year-on-year. This was attributed to higher prices for bread, cereals, oils, tubers, fish, fruits, meats, vegetables, and dairy.

Despite the annual increase, month-on-month food inflation saw a decline of 1.91%, indicating a slight improvement from September’s 2.45%.

Core inflation, excluding volatile food and energy prices, rose to 22.58% year-on-year, primarily due to increases in transportation, medical services, housing rentals, and pharmaceuticals.

Urban and rural inflation rates also rose, with urban areas seeing a year-on-year increase to 29.29% and rural areas reaching 25.58%. However, both experienced a decrease in month-on-month inflation.

At a state level, Kogi, Rivers, and Lagos had the highest inflation rates, while Borno, Jigawa, and Sokoto had the slowest increases, both year-on-year and month-on-month.

Dr. AbdulMumin reiterated the CBN’s commitment to its monetary policy, highlighting the positive impact of market reforms, particularly in October, leading to a decrease in month-on-month price changes.

The CBN’s actions, such as lifting the cap on the Standing Deposit Facility (SDF) and implementing Open Market Operations, have notably increased Open Buy Back (OBB) rates. Despite the uptick in October’s headline inflation to 27.33%, AbdulMumin remains confident that the CBN’s strategies are steering towards achieving price stability.

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