Nigeria’s annual consumer price inflation edged up to 7.8% in March from 7.7% the month before, reflecting marginally higher food prices, the country’s National Bureau of Statistics said. It noted that during the six months to end-March, the annual inflation rate has remained relatively stable, moving between 7.7% and 8.0%, within the central bank’s 6%-9% target band.
The annual food inflation (measured by the food sub-index, which includes farm produce and processed food) edged up to 9.3% last month from 9.2% in February, reflecting higher prices of bread, cereals, fish, dairy, oils and fats, and fruits.
The annual core inflation, which excludes the prices of volatile agricultural products, eased to 6.8% in March from 7.2% in the previous month.
Compared to the previous month, Nigeria’s consumer prices rose 0.78% in March, accelerating from a 0.5% increase in February. Monthly food inflation also increased to 1.0% last month from 0.6% in February, while monthly core inflation eased to 0.4% from 0.5%.
The average inflation for the 12-month period to end-March 2014 eased to 8.2% from 8.3% at end-February, with average food and core inflation rates both staying flat at 9.5% and 7.0%, respectively.
In March, Nigeria’s central bank tightened further its monetary stance with an increase in the private sector cash reserve requirement to 15%, despite the stable and relatively low inflation.
S&P has recently forecast that Nigeria’s average annual headline consumer price inflation will increase to 9.8% this year from 8.5% in 2013.
Last week, NBS head Yemi Kale said that the bureau plans to reweight the inflation index to 2009 from 2004 to take into account the changing consumption patterns of the growing middle class with rising incomes. The rebasing exercise, which is expected to be completed by the end of this year, will be aimed to reflect the impact of non-food items on prices more accurately, as the middle class is spending more on capital goods like cars and less on food. Volatile food prices now account for about 60% of the consumer price basket.
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