Nigeria’s Inflation Rate Drops to 32.15% in August, NBS Reports

Nigeria’s inflation rate fell to 32.15% in August 2024, a slight drop from the 33.40% recorded in July, according to the latest Consumer Price Index (CPI) and Inflation Data released by the National Bureau of Statistics (NBS) on Monday.

The report highlights a 1.25% decrease in the country’s headline inflation, marking the second consecutive month of decline.

The data also revealed a reduction in food inflation, which stood at 37.52% in August, down from 39.53% in July.

Despite this overall cooling of inflation, the country continues to face economic challenges, particularly in relation to rising fuel prices.

The decline in inflation comes against the backdrop of a recent fuel price hike, which many had feared would worsen the inflationary trend.

However, Johnson Chukwu, Managing Director of Cowry Asset Management, explained during an interview with Channels Television that the full impact of the fuel price increase is likely to be felt in the coming months.

“The lag in response to fuel price adjustments means the effects will become more pronounced in future inflation data,” he said.

In response to persistent inflationary pressures, the Central Bank of Nigeria’s (CBN) Monetary Policy Committee has continued to raise interest rates. The most recent hike occurred in July, when the rate was increased to 26.75%.

These rate adjustments are part of ongoing efforts to stabilise the economy, though they have led to higher borrowing costs for businesses and individuals.

Despite the reported dip in inflation, many Nigerians remain concerned about the rising cost of living. Prices of goods and services have continued to soar, making daily life increasingly difficult for many households.

The inflation rate, while declining, is still among the highest in recent years, and the impact is being felt across various sectors of the economy.

As the country grapples with these economic challenges, the government and financial institutions will be under increasing pressure to implement policies that can both control inflation and mitigate its effects on the population.

With further fuel price adjustments and global economic conditions potentially affecting inflation, the coming months will be crucial in determining whether Nigeria can sustain this downward trend.