Analysts are seeing the effect of the prolonged energy crises in Nigeria as a major contributor to the cost pressures in March, leading to a third consecutive monthly increase in inflation rate this year.
As a result economists at Financial Derivatives Company Limited, FDC, run by one of Nigeria’s notable economists, Bismark Rewane, stated “we are projecting a significant increase of 0.7 per cent in the March inflation number to 12.1 per cent”.
The Food Price Index, FPI, that the Food and Agriculture Organization, FAO, released last week shows that the FPI was up 1.0 per cent in March.
Prices for most of the food items that FSDH Research monitored in March 2016 increased. “The prices of tomatoes, rice, vegetable oil, beans, yam and meat increased by 15.56%, 11.11%, 7.59%, 6.67%, 4.76%, and 1.11% respectively. However, the prices of onions, Irish potatoes, fish and garri fell by 16.19%, 5.56%, 4.71% and 3.61% respectively”.
According to their research, prices of sweet potatoes and palm oil remained unchanged. However they stated “the movement in the prices of food items during the month resulted in 0.95 per cent increase in our Food and Non-Alcoholic Index to 191.70 points.
‘’Our model indicates that the price movements in consumer goods and services in March 2016 would increase the Composite Consumer Price Index, CCPI, to 188.23 points, representing a month-on-month increase of 1.26 per cent. We estimate that the increase in the CCPI in March will produce an inflation rate of 11.76 per cent”.
