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Headline Inflation Increases by 20.52% YoY in August 2022 as Food Inflation Rises by 23.12%

All Items Index

In August 2022, on a year –on- year basis, the headline inflation rate was 20.52%. This was 3.52% points higher compared to the rate recorded in August 2021, which was (17.01%). This shows that the headline inflation rate increased in the month of August 2022 when compared to the same month in the preceding year (i.e.August 2021). Meaning that in August 2022, the general price level was 3.52% higher relative to August 2021. 

On a month-on-month basis, the Headline inflation rate in August 2022 was 1.77%, this was 0.05% lower than the rate recorded in July 2022 (1.82%). This means that in August 2022 the headline inflation rate (month–on–month basis) declined by 0.05%. The percentage change in the average CPI for the twelve months period ending August 2022 over the average of the CPI for the previous twelve months period was 17.07%, showing a 0.47% increase compared to 16.60% recorded in August 2021. 

The Increases were recorded in all COICOP divisions that yielded the Headline index. 

Likely Factors Responsible For The Decline In The Monthly Inflation Rate (Month-on-month basis). 

1. Decline in current month food index relative to the reference month index which is due to harvest season. 

2. Relative stability in transportation cost due to availability of fuel. 

Likely Factors Responsible For The Increase In Annual Inflation Rate (Year-on-Year basis). 

1. Disruption in the supply of food products 

2. Increase in import cost due to the persistent currency depreciation 

3. General increase in the cost of production.

Urban Inflation 

On a year-on-year basis, in August 2022, the urban inflation rate was 20.95 %, this was 3.36% higher compared to 17.59 % recorded in August 2021. On a month -on-month basis, the urban inflation rate was 1.79% in August 2022, this was a 0.03 % decline compared to July 2022 (1.82%). The corresponding twelve-month average for the urban inflation rate was 17.59 % in August 2022. This was 0.4% higher compared to 17.19% reported in August 2021. 

Rural Inflation 

The rural inflation rate in August 2022 was 20.12% on a year-on-year basis; this was 3.69% higher compared to 16.43% recorded in August 2021. On a month-on-month basis, the rural inflation rate in August 2022 was 1.75%, down by 0.06% compared to July 2022 (1.81%). The corresponding twelve-month average for the rural inflation rate in August 2022 was 16.58%. This was 0.55% higher compared to 16.03% recorded in August 2021.

Food Index

The food inflation rate in August 2022 was 23.12 % on a year-on-year basis; which was 2.82% higher compared to the rate recorded in August 2021 (20.30%).This rise in the food inflation was caused by increases in prices of Bread and cereals, Food product n.e.c, Potatoes, yam and other tuber, fish, meat, oil and fat. 

On a month-on-month basis, the food inflation rate in August was 1.98%, this was a 0.07% decline compared to the rate recorded in July 2022 (2.04%). This decline is attributed to reduction in prices of some food items like Tubers, Garri, local rice and Vegetables. 

The average annual rate of food inflation for the twelve-month period ending August 2022 over the previous twelve-month average was 19.02%, which was a 1.48% decline from the average annual rate of change recorded in August 2021 (20.50%).

All Items Less Farm Produce

The ‘’All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 17.20% in August 2022 on a year-on-year basis; up by 3.79% when compared to 13.41% recorded in August 2021. 

On a month-on-month basis, the core inflation rate was 1.59% in August 2022. This was down by 0.17% when compared to 1.75% recorded in July 2022. 

The highest increases were recorded in prices of Gas, Liquid fuel, Solid fuel, Passenger transport by road, Passenger transport by Air, fuel and lubricants for personal transport equipment, Cleaning, Repair and Hire of clothing. 

The average 12-month annual inflation rate was 14.60% for the twelve-month period ending August 2022; this was 2.31% higher than the 12.29% recorded in August 2021.

State Profiles

In analysing price movements under this section, it should be noted that CPI is weighted by consumption expenditure patterns which differ across states and locations. Accordingly, the weight assigned to a particular food or non-food item may differ from state to state making interstate comparisons of consumption basket inadvisable and potentially misleading. 

All Items Inflation 

In August 2022, all items inflation rate on a year-on-year basis was highest in Ebonyi (25.33%), Rivers (23.70%), Bayelsa (23.01%), while Jigawa (17.30%), Borno (17.56%) and Zamfara (18.04%) recorded the slowest rise in headline Year-on-Year inflation. 

On a month-on-month basis, however, August 2022 recorded the highest increases in Anambra (2.78%), Ondo (2.53%), Nasarawa (2.40 %), while Yobe (0.68%), Borno (0.84%) and Zamfara (0.98%) recorded the slowest rise on month-on-month inflation. 

Food Inflation 

In August 2022, food inflation on a year-on-year basis was highest in Kwara (30.80%), Ebonyi (28.06%) and Rivers (27.64%), while Jigawa (17.77%), Zamfara (18.79%) and Oyo (19.80%) recorded the slowest rise on year-on-year food inflation. 

On a month-on-month basis, however, August 2022 food inflation was highest in Anambra (3.05%), Ondo (2.92%) and Bauchi (2.78%), while Yobe (0.46%), Oyo (0.89%) and Delta (0.94%) recorded the slowest rise on month-on-month inflation.

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