Nigeria’s consumer price inflation rose to 15.1% year-on-year in December from 14.8% the previous month. Growth in food prices, which form much of the index basket, declined slightly to 18.0% year-on-year from 18.1% in November. Inflation rose on a month-by-month basis, with the composite consumer price index (CPI) up 0.8% to 192.6 points in December. The rise in the index was caused mainly by an increase in the price of some staple food items. Per the Daily Trust:
With the 8.2 percent increase in the inflation rate in just about 13 months, experts believe this is not particularly healthy for the economy because the living standard of the people [will] further decline. What is more worrisome in this inflationary economy is that prices of goods have not only gone up but there is equally scarcity of money in circulation, thus, putting the purchasing power of consumers at its lowest ebbs.
This on the heels of last week’s developments, where Nigeria’s main stock index extended its losses for the year, making it the world’s second-worst performing equity market, as the country’s oil-dependent export revenue plunged and its naira was devalued. Nigeria has been using its foreign-currency reserves, which stand at about $53 billion, to help defend the naira, as revenue from crude, which accounts for 90% of the country’s export earnings, plunged. That said, on Monday, the naira gained more than 5% against the dollar in trading on Monday, prompting a shutdown in the market after breaching limits on fluctuations.