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NBS kale
Statistician General of the Federation, and head of the National Bureau of Statistics (NBS), Dr. Yemi Kale

Continued drop in inflation rate sign of economic recovery from recession

Economic pundits have started seeing the month-on-month drop in Nigeria’s inflation rate which receded to 16.1 per cent as early signs of recovery from recession.

Experts who spoke to Business Hilights on Monday shortly after the release of the nation’s inflation status by the National Bureau of Statistics (NBS) have said that more lights are now on the tunnel of effective exit as soon as possible from recession.

According to the latest report, Consumer Price Index (CPI) which measures inflation indicated that the index has receded from 16.25 per cent in May to 16.1 per cent as at the end of June.

Though they were of the opinion that the government needs to do more in policy consistency and encouragement of the real sector to raise productivity, NBS in the report said this is the fifth consecutive decline in inflation rate since January.

The new report said “The CPI which measures inflation increased by 16.1 per cent year on year in June 2017.

“This was 0.15 percentage points lower the rate recorded in May. Accordingly, this represents the fifth consecutive decline in the rate of inflation since January.”

Looking at the month-on-month basis, the NBS report said the Headline index rose by 1.58 per cent in June 2017, representing a decline of 0.30 percentage points from 1.88 per cent recorded in May.

Also cumulatively, Month on Month inflation had risen by 9.28 per cent since January 2017

The food index which majorly defines real state of affairs in the entire calculation increased by 19.91per cent (year-on-year) in June 2017, down by 0.64 percentage points from the 19.27 per cent recorded in May.

This compelled the federal agency to agree that the increase in food index is an indication of the continued pressure in food prices.

However, the document noted that Urban index rose by 16.15 percent year-on-year in June 2017 from 16.34 per cent recorded in May, while the Rural index increased by 16.01 per cent in June from 16.02 per cent in May.

The Month-on-Month figures showed also the index rose by 1.60 per cent in June from 1.84 per cent recorded in May, while the rural index rose by 1.57 per cent in June from 1.92 percent in May.

Observers say the trend of reducing inflationary rate may continue this month as federal government continue to pump in 2017 budgetary capital expenditures’.

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