Increases in the prices of basic food items continued for the 17th consecutive month, prompting the Food inflation to hit 20.6 per cent in January, the highest since September 2019.
Consequently, the nation's annual inflation rate also rose for the 17th consecutive months to 16.47 percent in January representing 0.71 percentage point increase from 15.8 percent in December 2020.
the National Bureau of Statistics, NBS disclosed this in its Consumer Price Index (CPI) Report for January 2021 released yesterday noting that the rise in the food inflation was caused by increases in prices of bread and cereals, potatoes, yam and other tubers, meat, fruits, vegetables, fish and oils and fats.
This upward trend in food prices, according to analysts, will persist due to the insecurity in the country and the approaching planting season.
The NBS stated: "The consumer price index, (CPI) which measures inflation increased by 16.47 percent (year-on-year) in January 2021. This is 0.71 percent points higher than the rate recorded in December 2020 (15.75 percent). Increases were recorded in all COICOP divisions that yielded the Headline index.
"On a month-on-month basis, the Headline index increased by 1.49 percent in January 2021. This is 0.12
percentage points lower than the rate recorded in December 2020 (1.61 percent)."
On the food inflation, the NBS stated: "The composite food index rose by 20.57 percent in January 2021 compared to 19.56 percent in December 2020.
"This rise in the food index was caused by increases in prices of Bread and cereals, Potatoes, Yam and other
tubers, Meat, Fruits, Vegetable, Fish and Oils and Fats.
"On a month-on-month basis, the food sub-index increased by 1.83 percent in January 2021, down by 0.22 percent points from 2.05 percent recorded in December 2020. "
Commenting on the development, Analysts at Financial Derivative Company (FDC) said: "The rate of inflation is expected to slow as interest rates rise and consumption declines. However, inflation-stoking factors persist. Petrol prices are likely to increase further towards N200/litre on higher oil prices.
"In addition, as we gradually enter the planting season, this coupled with rising insecurity across the country, will lead to supply shortages and keep food prices elevated."
Vanguard News Nigeria