Nigeria's inflation rate jumps to 11.85% in November 2019 – here are the factors responsible for the spike

A towel with a print of the Nigerian naira is displayed for sale at a street market in the central business district in Nigeria's commercial capital Lagos February 4, 2016. REUTERS/Akintunde Akinleye/File Photo
  • Nigeria's inflation rate jumped from 11.30% in October to 11.85% in November 2019.
  • The food index rose by 14.48% in November 2019 caused by increases in prices of bread, cereals, oils and fats, meat, potatoes, yam, fish, and other tubers.
  • The report reflects issues around the closure of the Nigerian borders and the festive season mood.

Nigeria's inflation rate jumped to 11.85% (year-on-year) in November 2019, representing 0.24% points higher than the rate recorded in October 2019.

The Nigerian Bureau of Statistics (NBS) stated this in its consumer price index (CPI) report for November 2019 released in Abuja on Tuesday, December 17th, 2019.

According to the report, "increases were recorded in all Classification of Individual Consumption According to Purpose (COICOP) divisions that yielded the headline index.

“On a month-on-month basis, the headline index increased by 1.02% in November 2019, this is 0.05% rate lower than the rate recorded in October 2019 at 1.07%.

“The percentage change in the average composite CPI for the twelve months period ending November 2019 over the average of the CPI for the previous twelve months period was 11.35%, representing a 0.05% point from 11.30% recorded in October 2019.”

Analysis of the data by Business Insider SSA showed that this is the highest rate recorded by the country since May 2018.

In April 2018, the inflation figure dropped from 12.48% to 11.61% in May 2018. Since then, it continues to nosedive and hit the lowest in more than three years in August 2019.

In its report, the composite food index rose by 14.48% in November 2019 compared to 14.09% in October 2019. “This rise in the food index was caused by increases in prices of Bread, cereals, oils and fats, meat, potatoes, yam, and other tubers, and Fish,” the Bureau said.

The report reflects issues around the closure of the Nigerian borders ordered by President Muhammadu Buhari to avoid smuggling of rice and other commodities and the festive season mood.

All other items excluding the prices of volatile agricultural produce stood at 8.99% in November 2019, representing 0.11% jump when compared with 8.88% recorded in October 2019. The highest increases were recorded in prices of cleaning, repair and hire of clothing, Hospital services, hairdressing salons, and personal grooming establishment, Glassware, tableware and household utensils, vehicle spare parts, repair and hire of footwear, shoes and other footwear, clothing materials, other articles of clothing and clothing accessories, medical services and passenger transport by air.

Impact: With rising inflation, the cost of living skyrockets, doing business becomes uneasy. It also impacts borrowings, mortgages, corporate, and government bond yields and the economy at large.

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