Nigeria’s Inflation Rate Climbs to 32.7% in September, Marking the First Increase in Three Months

Nigeria’s annual inflation rate rose to 32.7% in September 2024, breaking a three-month decline. This spike in inflation was attributed to rising gasoline prices and severe flooding in key food-producing areas, according to a report by the National Bureau of Statistics (NBS) published on Tuesday, October 15, 2024.

Consumer Price Index (CPI) Rises

The latest data from the NBS reveals that the Consumer Price Index (CPI), which measures the overall cost of goods and services, increased to 32.7% in September, up from 32.2% in August. This marks the first uptick since the inflation rate saw back-to-back decreases earlier in the year.

The Bureau noted: “In September 2024, the headline inflation rate was 32.70%, relative to the August rate of 32.15%. This represents an increase of 0.55% compared to the previous month. On a year-on-year basis, the inflation rate was 5.98 percentage points higher than the rate recorded in September 2023, which stood at 26.72%.”

Food Inflation Remains a Major Driver

Food prices continue to be a significant contributor to inflationary pressures. The food inflation rate soared to 37.77% on a year-on-year basis in September 2024, up from 30.64% recorded in September 2023. This spike in food inflation is mainly due to the rise in the prices of staple items like guinea corn, rice, maize, beans, yams, and other tubers.

The NBS added: “The rise in food inflation was driven by increases in the prices of grains, cereals, tubers, and oils. Additionally, prices of popular beverages like Milo, Lipton, and Bournvita, as well as vegetable oil and palm oil, saw considerable jumps.”

Month-on-Month Inflation Trends

On a month-to-month basis, the inflation rate for September 2024 was recorded at 2.52%, which is a 0.30% increase from August’s rate of 2.22%. Food inflation also followed a similar trend, with a month-on-month rise of 2.64%, showing a 0.27% increase compared to August.

Impact of Gasoline Prices and Flooding

The report attributes the surge in inflation to two primary factors: the rising cost of gasoline and the impact of floods in critical agricultural zones. The removal of fuel subsidies in mid-2023 caused gasoline prices to triple, raising transportation and logistics costs, which in turn affected the prices of goods and services. Flooding in major food-producing areas also disrupted supply chains, contributing to rising food costs.

Broader Economic Outlook

Despite the inflationary pressures, the World Bank projects a 3.3% growth in Nigeria’s economy for 2024, with a slight improvement forecasted in subsequent years. However, inflation remains a critical challenge, with many Nigerians feeling the effects of the higher cost of living, especially in imported goods.

The NBS concluded by noting that the average annual rate of food inflation for the twelve months ending September 2024 was 37.53%, marking an 11.88% increase from the 25.65% recorded in September 2023.

Key Takeaways

Nigeria’s inflation rate rose to 32.7% in September 2024, after a three-month decline.
Food prices, particularly for staples like grains, cereals, and oils, remain the main drivers of inflation.
Gasoline price hikes and flooding in food-producing areas are major contributing factors.
The inflationary trend is likely to continue, placing further pressure on Nigerian consumers.

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