Floods, Cost of Transportation Fuel Inflation in October -NBS

National Bureau of Statistics (NBS) said Monday that the composite Consumer Price Index which measures inflation in Nigeria rose to 11.7 per cent year-on-year in October (compared to 11.3 percent in September) on account of the recent floods which impacted on transportation of food.

According to NBS, on a year-on-year basis, the relative moderation in the headline index in September was offset by the rising cost of food items during the period.

The statement from the agency said that “While the “Core” index continued its declining trend over the last few months, rising to 12.4 percent in October from 13.1 percent in September, the food index increased to 11.1 percent from 10.2 percent over the same period,”

“ Since its year on- year peak of 15.2 percent in June of this year, the Core index continues to exhibit a declining trend partially as a result of uncompromising monetary policy on the part of the Central Bank of Nigeria.” NBS also said.

The Headline Index is made up of the Core Index and Farm Produce items. As Processed Foods are included in both the Core and Food sub-indices, this implies that these sub-indices are not mutually-exclusive.

“On a monthly basis, the composite CPI was higher by 0.88 percent when compared with September 2012. In October, the Urban inflation rate was recorded at 15.3 percent year- on- year, while the Rural index recorded a 9.1 percent year-on-year increase, relatively unchanged from September. Both the Urban and Rural All Items index increased by approximately 0.9 percent month-on- month each, when compared with the previous month. The percentage change in the average composite CPI for the twelve-month period ending in October 2012 over the average of the CPI for the previous twelve-month period remained unchanged at 11.9 percent, while the corresponding 12- month year-on-year average percentage change for Urban and Rural indices was 13.5 percent and 10.8 percent respectively.”

In October, the composite Food Index increased year-on-year to 11.1 percent, 0.9 percentage points higher than 10.2 percent recorded in September.

On a month-on-month basis, the Food index increased by 1.0 percent in September.

The rise in the Food Index was mainly due to higher food prices in various classes lead by meat, fish, potatoes, yams and other tubers, fruits, bread and cereals as well as other foods.

While the impact of security concerns on agricultural production has eased significantly, the higher food prices continue to reflect the impact of recent floods on the production of farm produce, resulting difficulty of moving food products to markets across the country, coupled with higher demand for food items due to the just concluded Muslim festival.