Inflation ebbs in January from the prior month

Latest reading: Consumer prices increased 15.1% on a year-on-year basis in January, following a 15.2% increase in the previous month. January's reading was the weakest since November 2020, and marked the tenth straight monthly decline. It is important to note that, at its last release, the National Bureau of Statistics (NBS) announced that it had revamped its methodology to “better reflect real-world prices”. Relative to the prior month's data, there were reduced price pressures for food (+7.8% on a year-on-year basis vs +11.3% in December) and clothing and footwear (+10.9% vs +13.2% in December). In contrast, price pressures were higher for housing and energy in January (+22.6% vs +17.6% in December). Meanwhile, core consumer prices increased 17.2% in annual terms in January, following a 18.2% rise in the previous month. Lastly, consumer prices declined 2.88% in January in month-on-month terms, following a 0.54% rise in the prior month.

Panelist insight: On inflation’s outlook, analysts at EIU commented: “Inflation will ease, but not to low levels. Nigeria's development needs and government economic policy suggest that it will be difficult to bring inflation down to single digits during the forecast period.”

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