BY NSE ANTHONY-UKO
The consumer price inflation stood at 9.6 per cent year-on-year in December, up 0.2 percentage points from November, and still above the Central Bank of Nigeria’s upper limit target of nine per cent, the National Bureau of Statistics said yesterday.



The agency said that the increase in the headline index was driven by higher prices within key divisions which contribute to the index, particularly imported food items and drinks, as well as clothing and footwear and transportation as a result of intermittent PMS supply shortages.

Food price inflation accelerated to 10.6 per cent year-on-year in December from 10.3 per cent in November.

All major food groups which contribute to the Food sub-index increased at a faster pace during the month with the exception of the Milk, Cheese and Eggs group, the NBS said.

Inflation had risen to 9.4 per cent in November after a drop to 9.3 per cent in September, moving further out of CBN single digit target band.

According to analysts at Financial Derivatives Company Limited, who say inflation is expected to rise to 9.5 per cent, exchange rate pressure, intermittent fuel scarcity, policy uncertainty and trade restrictions contributed to a higher consumer price index in December.

“Increased demand due to seasonal festivities resulted in higher food prices. Furthermore, the fuel scarcity that spilled over from November led to a spike in transport fares.”

Likewise, analysts at Standard Chartered Bank say sampling shows a 0.64 per cent rise in inflation, noting that items subject to foreign exchange restrictions, such as rice and tomato paste recorded the highest price gains with price increases of between nine to 18 per cent between June and December 2015.

Meanwhile the Nigeria’s inflation rate climbed to the highest in more than two years in September as food prices surged, exceeding the central bank’s target for a fourth month.

Emefiele has so far resisted calls to ease the foreign-exchange controls and devalue the naira despite criticism from investors, businesses and fellow members of the Monetary Policy Committee. The naira has averaged 198.99 per dollar since the restrictions were imposed in February.

The core inflation rate, which excludes agricultural products, fell to 8.9 per cent in September from nine per cent in August, the statistics office said.

Food inflation accelerated to 10.2 per cent from 10.1 per cent.

source: http://www.nairausd.com/2016/01/high-foods-drinks-import-raise-december.html?m=1

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