For the first time in over two years, Nigeria’s galloping inflation has shown signs of easing, with the headline inflation rate dropping to 33.40% in July 2024, down from 34.19% in June 2024. This decline marks a significant shift in the country’s economic landscape, which has been grappling with rising prices across various sectors.
According to a statement from the National Bureau of Statistics (NBS) website, food inflation on a month-on-month basis in July 2024 was recorded at 2.47%, reflecting a slight decrease of 0.08% compared to June 2024’s rate of 2.55%. The NBS attributed this decrease to a slowdown in the rise of average prices for items such as tin milk, baby powdered milk, and other dairy products; mudfish, fresh fish (obokun), and snail; date palm fruit (debenu) and watermelon; as well as garri, akpu (fufu), and other cereals. Prices of items like exercise books, textbooks, turkey meat, and minced pork also contributed to the overall reduction.
The NBS reported that the average annual rate of food inflation for the twelve months ending in June 2024 was 36.36%, which represents an increase of 11.90 percentage points from the 24.46% recorded in July 2023.
On a year-on-year basis, the headline inflation rate for July 2024 was 9.32 percentage points higher than the rate recorded in July 2023, which stood at 24.08%. This indicates a continued increase in inflation compared to the same month in the previous year.
Month-on-month, the headline inflation rate in July 2024 was 2.28%, slightly lower by 0.03% than the rate recorded in June 2024 (2.31%). This suggests that while prices continued to rise in July, the rate of increase was slower compared to June.
The percentage change in the average Consumer Price Index (CPI) for the twelve months ending July 2024 over the previous twelve-month period was 30.76%, showing an 8.84% increase compared to the 21.92% recorded in July 2023.
In urban areas, the year-on-year inflation rate in July 2024 was 35.77%, which is 9.94 percentage points higher than the 25.83% recorded in July 2023. On a month-on-month basis, the urban inflation rate was 2.46% in July 2024, remaining almost unchanged from June 2024.
The NBS also noted that the twelve-month average urban inflation rate was 32.89% in July 2024, up by 10.02 percentage points from the 22.87% reported in July 2023. In rural areas, the inflation rate was 31.26% year-on-year in July 2024, an 8.77 percentage point increase from the 22.49% recorded in July 2023. On a month-on-month basis, the rural inflation rate dropped to 2.10% in July 2024, down by 0.07 percentage points compared to June 2024.
The corresponding twelve-month average rural inflation rate was 28.86% in July 2024, reflecting a 7.82 percentage point increase from the 21.04% recorded in July 2023.
This easing of inflation, although modest, signals a potential turning point for Nigeria’s economy, which has been under pressure from high inflation rates for an extended period. The government and policymakers will likely continue monitoring these trends closely as they work to stabilize the economy.
