Nigeria’s inflation rate experienced a slight decrease in August, dropping from 33.40% in July to 32.15%. However, the declining value of the naira and rising fuel prices are undermining this progress, potentially reigniting inflation.
Michael Anthony, an engineer and father of four, continues to face steep costs despite the small dip in inflation. “In July, I bought a bag of rice for 65,000 naira, but just three days ago, it cost me 95,000 naira,” he said, expressing concern that prices may rise again due to fuel costs.
At a market in Abuja, food trader Blessing Ochuba is feeling the pinch. With customers unable to purchase in bulk, she’s reducing her stock and adjusting prices to stay afloat. “Customers who used to buy in bags are now buying half or a quarter because they can’t afford more,” she explained. “I used to buy 10 bags of rice, but now I can barely afford five. Everything is going up.”
Despite the reported dip in inflation, Nigeria’s currency has weakened significantly, moving from 1,200 to 1,600 naira to the dollar, and gasoline prices have surged from 620 to nearly 1,000 naira per liter in just three months.
Development economist Hauwa Mustapha attributed the slight decline in inflation to a government policy exempting food imports from excise duty for 90 days. “That helped boost food supply, but it doesn’t indicate a long-term recovery,” she noted, emphasizing the need for effective government measures.
To manage inflation in both the short and long term, Mustapha suggests focusing on food supply policies. “As we approach harvest season, it’s crucial to minimize post-harvest losses to maintain a steady food supply.”
Experts believe the government’s upcoming actions will determine if this inflation decrease marks a genuine recovery or merely a temporary reprieve.