Nigeria’s annual inflation hits highest level since 2005 | WSAU News/Talk 550AM 99.9FM

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By Chijioke Ohuocha

ABUJA (Reuters) – Nigeria’s annual inflation accelerated in July to its highest level since 2005, official data showed on Monday, as prices for food, fuel and clothing rose.

The National Bureau of Statistics (NBS) said inflation rose for the sixth consecutive month, reaching 19.64% from 18.60% year-on-year in June.

SNB data showed July inflation was the highest since at least the start of 2009.

Refinitiv data showed it was the highest since the 24.32% recorded in September 2005.

Inflation has been in double digits in Africa’s biggest economy since 2016, fueled in part by a weakening naira currency.

Food prices increased by 22.02% year on year in July, due to higher prices for bread and cereals, potatoes, yams, meat, fish, oil and other products.

Core inflation, which excludes the prices of agricultural products, increased by 16.26% compared to the same period last year, with gas, liquid and solid fuels, road and air transport, clothing and clothing rental among contributing factors.

Rising inflation and the state of the economy are major issues as the country heads towards national elections in February, when voters will choose a new president as incumbent President Muhammadu Buhari steps down.

The naira currency has weakened in the parallel market due to a shortage of foreign currency since July 2021, when the central bank halted sales of currencies to FX traders to ease pressure on reserves and support the official market .

This move channeled demand into the unofficial market, where the currency is freely traded.

Policymakers say lingering inflationary pressures are structural and largely import-related.

Capital Economics analysts said in a research note that inflation in Nigeria was likely not far from its peak but would remain high.

They predicted another interest rate hike at the next central bank policy meeting in September.

(Reporting by Chijioke Ohuocha, editing by Alexander Winning and Ed Osmond)

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