Mr. Simon Harry, the Statistician-General of the Federation, says the present fuel crises being experienced across the nation may have adverse effects on inflation rate.
He said this on Tuesday in Abuja, at a media conference to announce the January 2022 Consumer Price Index (CPI).
Harry said that the fuel crisis would create an artificial shock in the economy and that the shock was capable of shaking the economy.
“Whether we like it or not, transporters will be taking advantage of the situation, thereby, increasing the costs of transportation.
“As you are bringing your commodities to the market for sale, you will be thinking of adding some amount on the selling costs so that you will be able to recover the costs of transportation.
“So that gives us a negative signal that is capable of affecting not just inflation rate, but also other macro-economic variables such as the Gross Domestic Product (GDP) and even the unemployment rate.
“I can, however, assure you that certainly, it is not the best for the economy and if we must maintain a stable macroeconomic environment, this kind of crisis certainly is not the best for it is not needed.’’
He added that because the economy was strongly being driven by the private sector, the shock may affect a good number of private businesses as they may not be able to run effectively as expected.
He, however, said that the February inflation rate could not be predicted based on the present fuel crisis as the numbers were still being collected.
On the present rate, the statistician-general said that CPI for January was 15.60 percent from 15.63 percent recorded in December 2021.
However, on a year-on-year basis, it was 0.87 percent points lower than the rate recorded in January 2021 (16.47) percent.
Harry said that the headline index increased by 1.47 percent in January, 0.34 percent points lower than 1.82 percent recorded in December 2021.
According to Harry, core inflation for January was 13.87 percent, the same as that of December 2021, while food inflation for January was 17.13 percent compared to 17.37 percent in December.
He also said that urban inflation rate stood at 16.17 percent year-on-year in January, the same as that of December 2021.
“On the other hand, rural inflation was 15.06 percent and 15.11 percent in and December 2021 respectively.
“On state-by-state comparison, all items inflation on year-on-year basis was highest in Abuja with 18.59 percent followed by Kogi with 18.28 percent and Bauchi 17.61 percent.
“On the other hand, Kwara recorded the lowest with 12.94 percent followed by Niger with 14.10 percent and Oyo, 14.19 percent.’’
Harry added that composite food index rose by 17.13 percent in January 2022, compared to 20.57 percent in January 2021.
The rise in the food index was caused by increases in prices of bread and cereals, food products such as potatoes, yam, and other tubers, soft drinks, oils and fats, and fruits.
“On month-on-month basis, the food sub-index increased by 1.62 percent in January, which was down by 0.57 percent points from 2.19 percent recorded in December 2021.
“The All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 13.87 percent in January 2022.
“This was higher by 2.02 percent, when compared to 11.85 percent, the rate recorded in January 2021.’’
He said that the highest increases were recorded in prices of electricity, liquid fuel, wine, tobacco, spirit, solid fuels, cleaning, repair, and hire of clothing.
Others are shoes and other footwear, other services in respect of personal transport equipment, other services not elsewhere classified, and pharmaceutical products.
For food inflation, on state by state basis, Harry said on a year-on-year basis it was highest in Kogi with 22.61 percent followed by Enugu with 19.84 percent and Akwa-Ibom 19.67 percent,
Meanwhile, Sokoto had 14.18 percent, Bauchi 14.63 percent, and Kaduna 15.01 percent as the lowest in January.
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