The latest data released by the Nigerian Bureau of Statistics (NBS) reveals a significant surge in headline inflation for February 2024, with the rate soaring to 31.70% compared to January 2024’s rate of 29.90%. This increase of 1.80% points highlights a concerning trend in the country’s economic trajectory.
On a year-on-year basis, the headline inflation rate witnessed a staggering rise of 9.79% points from February 2023, marking a significant jump from 21.91% to 31.70%. This substantial increment underscores the persistent challenges faced by Nigeria in stabilizing its economy.
“The headline inflation rate (year-on-year basis) increased in the month of February 2024 when compared to the same month in the preceding year (i.e., February 2023),” according to the NBS report.
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The report attributes this surge in inflation to various factors, including rising prices of essential commodities.
“The rise in Food inflation on a year-on-year basis was caused by increases in prices of Bread and cereals, Potatoes, Yam and other Tubers, Fish, Oil and fat, Meat, Fruit, Coffee, Tea, and Cocoa,” the NBS report explained.
Breaking down the data further, the urban inflation rate for February 2024 reached 33.66%, marking a 10.87% point increase from the previous year. In comparison, the rural inflation rate stood at 29.99%, indicating an 8.89% point rise from February 2023. These figures underscore the widespread impact of inflation across both urban and rural areas of Nigeria.
“On a year-on-year basis, in February 2024, the Urban inflation rate was 33.66%, this was 10.87% points higher compared to the 22.78% recorded in February 2023,” the NBS report detailed.
Food inflation, a critical component affecting household budgets, surged to 37.92% year-on-year in February 2024, up by 13.57% points from the same period last year.
“The rise in the Food inflation on a Year-on-Year basis was caused by a rise in the rate of increase in the average prices of Bread and Cereals, Potatoes, Yam & Other Tubers, Fish, Coffee, Tea, and Cocoa,” the NBS report said.
Additionally, core inflation, which excludes volatile food and energy prices, rose to 25.13% year-on-year in February 2024, marking a 6.76% point increase from February 2023. This upward trend in core inflation suggests broader economic challenges beyond the food and energy sectors, impacting various consumer goods and services.
“The ‘All items less farm produces and energy’ or Core inflation stood at 25.13% in February 2024 on a year-on-year basis; up by 6.76% when compared to the 18.37% recorded in February 2023,” the report said.
State-by-state food inflation
In February 2024, food inflation on a year-on-year basis was most pronounced in Kogi (46.32%), Rivers (44.34%), and Kwara (43.05%), while Bauchi (31.46%), Plateau (32.56%), and Taraba (33.23%) experienced the slowest increase in food inflation year-on-year.
However, on a month-on-month basis, February 2024 saw the highest food inflation in Adamawa (5.61%), Yobe (5.60%), and Borno (5.60%), whereas Cross River (2.08%), Niger (2.56%), and Abuja (2.60%) observed the least escalation in food inflation on a month-on-month basis.
The inflationary pressures have prompted calls for urgent action from civil society groups and labor unions. With the minimum wage stagnant at N30,000 per month, the rising inflation has severely eroded the purchasing power of Nigerian workers.
In response to the escalating inflation, labor unions have proposed revised wage structures ranging from N794,000 to N485,000 across the six geopolitical zones. These proposals aim to alleviate the financial strain faced by workers amidst the challenging economic conditions.
Despite efforts to address inflationary challenges, the Nigerian economy remains vulnerable to external shocks and internal structural weaknesses. Policymakers face the daunting task of implementing measures to stabilize prices, boost productivity, and enhance economic resilience in the face of persistent inflationary pressures.