In March 2024, Nigeria witnessed a sharp increase in headline inflation, soaring to 33.20% compared to February’s rate of 31.70%, according to the latest data from the Nigerian Bureau of Statistics (NBS).
The 1.50% rise is attributed to the persistent inflationary pressures gripping the nation’s economy. Year-on-year, the headline inflation rate in March 2024 was 11.16% points higher than the same month in 2023, marking a significant uptick from 22.04% to 33.20%.
Breaking down the data, the month-on-month headline inflation rate for March 2024 stood at 3.02%, slightly lower than February’s 3.12%. This indicates a slower rate of increase in the average price level compared to the previous month.
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However, despite this marginal decline, inflationary pressures remain a cause for concern, particularly in the food sector.
“The percentage change in the average CPI for the twelve-month period ending March 2024 over the average of the CPI for the previous twelve-month period was 27.13%, showing a 6.76% increase compared to 20.37% recorded in March 2023,” the NBS said.
Food Inflation Hits Record High
The food inflation rate surged to a record high of 40.01% in March 2024, a staggering 15.56% points higher than in March 2023. This unprecedented rise reflects the acute challenges facing consumers as food prices continue to escalate. Notably, the surge in food inflation was driven by increases in prices across various food categories, including staples like garri, millet, yam, and palm oil.
On a month-on-month basis, food inflation in March 2024 decreased slightly to 3.62%, down from 3.79% in February. This marginal decrease, however, does little to alleviate the burden on consumers already grappling with high food prices. Factors such as disruptions in the supply chain and increased production costs contribute to the persistent upward trajectory of food prices.
The average annual rate of food inflation for the twelve months ending March 2024 was 31.40%, a significant 8.69% points increase from the previous twelve-month average recorded in March 2023. This underlines the sustained upward pressure on food prices, exacerbating the challenges faced by households across the country.
Urban and Rural Inflation
On a year-on-year basis, urban inflation surged to 35.18% in March 2024, a substantial increase of 12.11% points compared to March 2023. Similarly, rural inflation rose to 31.45%, marking a 10.37% increase over the same period. While both urban and rural areas experienced significant inflationary pressures, the burden is particularly acute in urban centers, where prices tend to be higher.
Month-on-month, urban and rural inflation rates remained relatively stable, with urban inflation standing at 3.17% and rural inflation at 2.87%. Despite the slight differences, both urban and rural areas continue to grapple with high inflation rates, eroding purchasing power, and reducing the standard of living for many Nigerians.
Core Inflation
Core inflation, which excludes the prices of volatile agricultural products and energy, surged to 25.90% on a year-on-year basis in March 2024, up from 19.63% in March 2023. This increase reflects broader inflationary pressures beyond the food sector, driven by rising prices in transportation, housing, and medical services.
Month-on-month, core inflation increased to 2.54% in March 2024, up from 2.17% in February. This uptick underscores the broad-based nature of inflationary pressures, affecting various sectors of the economy and impacting consumers’ purchasing power.
State by state inflation rates
In March 2024, headline inflation rates varied across states, with Kogi, Bauchi, Kwara, and Oyo recording the highest rates, while Borno, Benue/Taraba, and Katsina recorded the slowest rise in headline inflation. Similarly, food inflation rates showed regional disparities, with Kogi, Kwara, and Akwa Ibom experiencing the highest rates, while Nasarawa, Borno, and Bauchi recorded the slowest rise in food inflation.
“In March 2024, All Items inflation rate on a Year-on-Year basis was highest in Kogi (39.97%), Bauchi (38.34%), Kwara (38.10%), and Oyo (37.29%), while Borno (25.78%), Benue/Taraba (28.12%) and Katsina (28.32%) recorded the slowest rise in Headline inflation on Year-on-Year basis.
“On a Month-on-Month basis, however, March 2024 recorded the highest increases in Zamfara (3.90%), Abia (3.89%), Ondo (3.75%), while Borno (1.46%), Yobe (1.84%) and Adamawa (1.85%) recorded the slowest rise on Month-on-Month inflation,” the report said.
The surge in headline and food inflation rates in March 2024 underscores the acute challenges facing Nigeria’s economy and has been eroding purchasing power, exacerbating poverty, and undermining economic stability.
Experts said addressing the root causes of inflation, including supply chain disruptions and production bottlenecks, requires concerted efforts from policymakers, businesses, and other stakeholders.