Nigeria’s Inflation Rate Surges Despite Naira Appreciation

In a recent update from the National Bureau of Statistics (NBS), Nigeria’s inflation rate has seen a significant rise, reaching 33.20% in March 2024.

This marks an increase from February’s rate of 31.70%, indicating a 1.50 percentage point escalation within just one month.

The Consumer Price Index (CPI) report issued by the NBS on Monday highlighted that this upward trend in prices is more pronounced when viewed on an annual scale. The year-on-year comparison shows an alarming 11.16 percentage point surge from the 22.04% rate recorded in March 2023.

Despite a slight decrease in the month-on-month inflation rate—from 3.12% in February to 3.02% in March—the general price levels continue to climb at a considerable pace. This suggests that while the monthly rate of price increases has moderated slightly, the overall inflationary pressure remains intense.

Interestingly, this inflationary spike occurs amidst an appreciating Naira, which has gained over 40% in value against the dollar in recent months, moving from around N1,900/$ to N1,100/$1. This appreciation was expected to temper inflation, but the recent figures suggest otherwise.

The inflation report follows closely on the heels of the Monetary Policy Committee (MPC) decision to raise interest rates from 22.75% to 24.75%, an attempt to curb the escalating inflation.