Dear Subscriber,

The NBS released its official inflation data today (October 15). As widely expected, Nigeria’s headline inflation continued its upward trend, rising by 0.87% to 28.20% from 27.33% in October. This steep rise largely reflects the impact of money supply saturation (M3 grew by 36% y-o-y), exchange rate depreciation (currently trading at N1,230/$) and high logistics costs (diesel price remains elevated at N1,080/litre) on food prices. This was compounded by the festive-induced boost in aggregate demand.

Food inflation rose by 1.32% to 32.84% with bread, cereals, yam, fish, meat, vegetables, and eggs recording the highest price increases. Meanwhile, core inflation fell slightly by 0.2% to 22.38%, an indication that the inflation momentum may be tapering.

All hope is not lost!

The CBN has repeatedly warned that inflation above 12% is growth-retarding. It has also reiterated its commitment to maintaining price stability. Analysts are therefore of the view that the MPC will raise rates by 100 basis points (bps) in January.

Ghana, which witnessed an inflation rate of 54.1% last December, has been able to rein in inflation, bringing it down to 26.4% in November 2023. Cumulative interest rate increases in Ghana is 1,650bps since November 2021.

In the download and link, the FDC Think Tank analyzes the November inflation numbers and the impact on businesses and the economy.

Do enjoy your read!