For the 14th consecutive time since January 2017, inflation rate inched closer to the single digit target set by both monetary and fiscal authorities for the economy.
The latest figures released yesterday by the National Bureau of Statistics (NBS) showed that the consumer price index (CPI), which measures inflation level in the economy, increased by 13.34 per cent between March 2017 and March 2018.
The statistics agency said the new figure was about 0.99 per cent points less than the 14.33 per cent rate recorded in February 2018.
During the last Monetary Policy Committee (MPC) meeting held last week in Abuja, the Central Bank of Nigeria (CBN) governor, Godwin Emefiele, had said that members resolved to retain all controlling policy rates at prevailing levels until inflation rate dropped to the single digit zone.
Apart from Monetary Policy Rate (MPR), also known as lending rate, which was retained at 14 per cent, liquidity rate was maintained at 30 per cent.
Also, cash reserve requirement, the amount of cash the banks are allowed to keep in their reserves, was kept at 22.5 per cent.
The Asymmetric corridor was left at +200 and -500 basis points around the MPR, as it was during the previous meeting in November 2017.
In the NBS report, composite food index, which highlights the average price of some food items, mainly staple foods, rose by 16.08 per cent (year on year) in March 2018, down from the 17.59 per cent rate recorded in February.
The federal government, which represents the fiscal authorities, had equally set the target of single digit inflation rate.
This is just as it continues the pursuit of policies and programmes to strengthen the economic recovery which, analysts say, remains fragile since the recent exit from recession.
In line with the projections of analysts, the rate at which prices of goods and services rose in the month of March declined to 13.34 per cent, making it the 14th consecutive decline in inflation since January last year.
The figure released by the National Bureau of Statistics yesterday was the lowest level in two years, dropping from 14.33 percent which it was in February.
A separate food price index showed inflation was trimmed to 16.08 per cent in March, from 17.59 percent the preceding month. Food inflation has been in double digits for almost three years, but has slowed for the past six months.
The CPI report showed that increases were recorded in all COICOP divisions that yield the Headline Index.
On a month-on-month basis, the Headline Index increased by 0.84 percent in March 2018, up by 0.05 per cent points from the rate recorded in February.
The percentage change in the average composite CPI for the twelve month period ending March 2018 over the average of the CPI for the previous twelve month period was 15.60 percent, showing 0.33 percent point lower from 15.93 percent recorded in February 2018.
The urban inflation rate eased by 13.75 percent (year-on-year) in March 2018 from 14.76 percent recorded in February, while the rural inflation rate also eased by 12.99 percent in March 2018 from 13.96 percent in February.
Commenting on the inflation figures, an analyst at FXTM, Lukman Otunuga, noted that the easing of consumer prices suggests that inflationary pressures are slowly becoming a thing of the past.
“Inflation in Nigeria decelerated to 13.34 per cent compared to last year, dragging consumer price growth below the 14 per cent benchmark interest rates for the first time in two years.
“With inflation steadily cooling and economic conditions constantly improving, the Central Bank of Nigeria is enroute to cut interest rates. While an interest rate cut at the next policy meeting in May could be premature, the Central Bank may surprise markets by taking action in the third quarter of 2018,” Otunuga said.
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