How Low Food Prices Helped Keep Nigeria Inflation Down
It appears one could not talk about declining inflation while prices of food items remained up.
But following the harvest season and government’s investment in food security, food prices have seen a significant drop.
This has led to the annual inflation falling to its lowest level in almost a year in February and slowed for a 13th month in a row.
This is according to inflation data released by the National Bureau of Statistics, NBS on Wednesday.
Core inflation, that is besides the food inflation, was 14.33% in February, its lowest since last April, down from 15.13% in January.
The food price index showed inflation of 17.59% in February down from 18.92% in January.
Recall that Yemi Kale, who is head of NBS, said in January that he expected inflation to fall faster this year, but spending ahead of 2019 presidential elections could raise inflation.
Food price inflation has remained in high double digits over the last year.
Kale has said the country is in a harvest period and output is increasing, which would help lower food prices, but noted that household consumption remains fragile after the 2016 recession.
Also recall that Central Bank of Nigeria, CBN governor, Godwin Emefiele said in January that in inflation continues to drop, it may consider interest rate cut by middle of the year.
The bank has kept its main interest rate at 14% for over a year as it battles inflation and seeks to attract foreign investors to support the naira.
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