Nigeria: Food, healthcare costs weigh on rising inflation June 2020

*Prices of medical services, pharmaceutical products, transport, associated services also increased

*Central Bank expected to meet Monday, July 20 to set interest rates ─Report

Alexander Davis | ConsumerConnect

Sequel to the far-reaching impacts of Coronavirus pandemic on consumers, and its attendant disruption of logistics as well as the subsequent currency devaluation by the Central Bank of Nigeria (CBN), annual inflation in Nigeria rose for a 10th straight month in June 2020.

According to the National Bureau of Statistics (NBS), Abuja, FCT, Friday, July 17, food and healthcare costs further pushed the increase in inflation rate.

The NBS stated that inflation climbed to 12.56%, its highest level in more than two years, from 12.4% in May, says agency report.

It was learnt that the CBN is expected to meet Monday, July 20 to set interest rates after it recently depreciated the country’s currency Naira by 5.5% against the Dollar on the official market, its second adjustment in six months.

Rising inflation has caused yields on Treasury bills and bonds to turn negative, a major stumbling block for the central bank’s push to attract foreign inflows to support the naira and boost the economy, stated the report.

Prices of medical services, pharmaceutical products, transport and associated services, rose the most on the non-food index.

According to the NBS, a separate index for food, which accounts for the bulk of the inflation basket, showed a price increase of 15.18% from 15.04% in May.

Food inflation has been in double digits for more than three years.

The rise in the food index was caused by increases in bread and cereals, potatoes, yam and meat, fish and vegetables.

Nigeria as Africa’s top oil exporter is reportedly facing economic hardship from the COVID-19 outbreak and sharp falls in crude prices, which have caused a steep decline in growth.

The government expects the economy to contract by as much as 8.9% this year.