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BuildingEconomyFood ProductionNigeriaOil & Gas

foreign exchange scarcity and fuel price push inflation to 21.09%

by Radarr Africa
written by Radarr Africa

The increase in the price of fuel, scarcity of foreign exchange, and disruption in food supply chain pushed headline inflation to a new record high of 21.09 per cent in October, according to the National Bureau of Statistics.

This is 0.32 per cent higher than 20.77 per cent reported in September. This means that the cost of living is rising rapidly in Africa’s most populous nation.

The NBS said, “Likely factors responsible for the increase in annual inflation rate (year-on-year basis): disruption in the supply of food products; increase in cost of importation due to the persistent currency depreciation; and a general increase in the cost of production e.g., increase in energy cost.”

While inflation has been on the increase year-on-year, the statistics body revealed that there had been a decline in headline inflation month-on-month in the last three months due to a decline in the changes in the food index. It stated this might be because the nation was currently in its harvesting season.

Speaking in its, ‘Consumer Price Index October 2022’ report, the NBS said, “In October 2022, on a year–on–year basis, the headline inflation rate was 21.09 per cent. This was 5.09 per cent points higher compared to the rate recorded in October 2021, which was 15.99 per cent.

ALSO READ: ICAN advises Central Bank of Nigeria on currency redesign and economic growth

“This shows that the general price level for the headline inflation rate increased in October 2022 when compared to the same month in the preceding year (i.e., October 2021) by 5.09 per cent. On a month-on-month basis, the Headline inflation rate for October 2022 was 1.24 per cent, this was 0.11 per cent lower than the rate recorded in September 2022 (1.36 per cent). This means that in October 2022 the general price level for the headline inflation rate (month–on–month basis) declined by 0.11 per cent.”

According to the NBS, urban inflation rate had risen to 21.63 per cent while rural inflation was now 20.57 per cent. It further revealed that increases in the prices of bread, cereals, potatoes, yams, other tubers, oil and fat pushed food inflation to 23.72 per cent in October. Flood-ravaged Kogi is the worst hit, with inflation hitting 25.15 per cent in the month.

The nation’s statistics body said, “In October 2022, all items inflation rate on a year-on-year basis was highest in Kogi (25.15 per cent), Bauchi (23.45 per cent), Ondo (23.45 per cent), while Plateau (19.02 per cent), Borno (19.31 per cent) and Nasarawa (19.39 per cent) recorded the slowest rise in headline y-o-y.”

In October, fuel scarcity hit different parts of the nation, with filling stations selling petrol above the approved price of N180-N185/litre. This affected the price of transportation as public transport workers transferred this increase in cost to commuters.

SOURCE: Punch news

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BusinessEconomyManufacturing & Consumer GoodsNigeria

Rising inflation drives Nigerians consumption expenditure to N57tn

by Radarr Africa
written by Radarr Africa

Rising inflation drove Nigerians’ consumption expenditure to N57.08tn in the first half of 2022.

This is a 14.39 per cent increase from the N49.89tn that was spent in the corresponding period of 2021, according to the ‘Nigerian Gross Domestic Product Report (Expenditure and Income Approach)’ report by the National Bureau of Statistics.

The NBS defined household final consumption expenditure as spending, including “imputed expenditure, incurred by resident households on individual consumption goods and services. This is calculated as a residual.”

The agency further disclosed that household final consumption grew by 6.94 per cent and 17.64 per cent in Q1 and Q2 2022 respectively, on a year-on-year basis, in real terms. It stated that the growth rates were lower compared to those of the corresponding quarters of 2021, which recorded 47.16 per cent and 42.40 per cent respectively.

It said, “The observed trend since 2020 indicates that real household consumption expenditure declined in Q1 and Q2 accounting for negative growth rates informed by the COVID-19 pandemic.

“However, positive growth rates were recorded in Q3 and Q4 of 2020 as well as the four quarters of 2021. As the economy recovers from the shock of the pandemic, Q1 and Q2 2022 growth rates have shown lower rates relative to the corresponding quarters of 2021.

ALSO READ: LSETF partner with organizers of BusyBee Event to support businesses through summit

“On a quarter-on-quarter basis, real household consumption expenditure grew by -8.50 per cent in Q1, and 2.32 per cent in Q2 2022. In nominal terms, household final consumption expenditure grew by 8.14 per cent in Q1, and 20.99 per cent in Q2 2022.”

In its report, the NBS revealed that household consumption accounted for 76.79 per cent of real GDP at market prices in Q1 2022, and 78.99 per cent in Q2 2022, leaving little for investments and others.

According to the Organisation for Economic Co-operation and Development, household spending was the amount of final consumption expenditure made by households to meet their everyday needs such as food, clothing, housing (rent), energy, transport, durable goods, health costs, leisure, and miscellaneous services.

It added that it was about 60 per cent of GDP and was an important variable for economic analysis of demand.

Since 2021, headline inflation rose from 16.47 per cent in January 2021 to 18.60 per cent as of June 2022. It rose further to 18.60 per cent in September 2022.

In its September inflation report, the NBS stated that the disruption in the supply of food products, increase in import cost due to the persistent currency depreciation, and the general increase in the cost of production were driving higher prices for goods and services.

SOURCE: Punch news

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Business and EconomyNigeriaWestern Africa

Nigeria’s inflation hits increases by 20.8% amid soaring food prices

by Radarr Africa
written by Radarr Africa

Nigeria’s inflation rate hit a 17-year high on the back of soaring food prices and supply chain disruption in September, a report by the National Bureau of Statistics (NBS) said on Monday.

The Consumer Price Index (CPI) report released by the NBS showed that inflation rose by 20.8% in September, the highest rate since 2005, up from 20.52% recorded in the previous month.

On a month-on-month basis, the index rose by 1.36% compared to the 1.77% increase recorded in the previous month, it said.

The NBS report showed that urban inflation stood at 21.25% in September 2022 from 17.19% recorded in the corresponding period of 2021, while rural inflation stood at 20.32%.

Food Inflation

The food inflation rate stood at 23.34% on a year-on-year basis, recording a surge from the 23.12% recorded in the previous month.

The NBS said increase in the food index was attributed to increases in prices of bread and cereals, food products, potatoes, yams, and other tubers, oil, and fat.

The ‘’All items less farm produce’’ or core inflation, including the prices of volatile agricultural produce, stood at 17.60%, up from 17.2% recorded in August 2022.

The bureau said the highest increases were recorded in prices of gas, liquid fuel, passenger transport by air, passenger travel by road, and solid fuel.

The NBS explained that rising inflation rate was caused by soaring food prices, disruption in food supply chain, rise in import cost due to the currency depreciation, and increase in the cost of production.

The inflation rate increase places renewed pressure on the Nigerian apex bank to increase interest rates and put inflationary pressure at bay.

ALSO READ: All you need to know about CBN’s 500K Grant for young entrepreneurs

Last month, the policy-setting committee of the Central Bank of Nigeria (CBN) raised the monetary policy rate (MPR), which measures interest rate, from 14 percent to 15.5 percent, the third consecutive increase in 2022.

On Monday, a report by Agora Policy which analysed Nigeria’s economic datasets from 2011 to 2021, called for in-depth reforms in trade and investment, inflation, interest and exchange rates, unemployment, and poverty.

Source: Premium Times

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AfricaEconomyGlobal NewsNews

Turkey’s inflation rate hits 83%

by Radarr Africa
written by Radarr Africa

Turkish inflation jumped to a new 24-year high exceeding 83 percent in September, official data showed Monday, after the central bank cut interest rates despite surging prices.

Turkey’s monetary policymakers are bucking the global trend of central bank raising interest rates to combat inflation, as high borrowing rates cool down the economy and prices.

But President Recep Tayyip Erdogan, who has focused on growth ahead of a general election in June, has repeatedly railed against higher rates, calling them his “biggest enemy”.

The country’s central bank has followed his philosophy, lowering its policy rate to 12 percent from 13 percent last month.

Erdogan has called for more rate cuts at the bank’s next policy meeting on October 20.

The TUIK state statistics agency said Monday that consumer prices rose by 83.45 percent in September on an annual basis, up from 80.2 percent in August.

The Turkish lira hit a new record low of 18.56 against the dollar following the announcement.

But opposition leaders and many Turks no longer trust official government data.

A respected monthly study released by independent economists from Turkey’s ENAG research institute also showed prices soaring – at a much higher rate than the one reported by the state statistics agency.

ENAG said the official annual rate of consumer price increases reached 186.27 percent in September, compared to 181.37 percent in August.

Source: AFP

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AfricaAFRICA NEWSEconomyNewsSouth AfricaSouthern Africa

SA inflation dips to 7.6% in August, the lowest monthly change since January

by Radarr Africa
written by Radarr Africa

South Africa’s headline consumer inflation fell to 7.6% year on year in August, data showed on Wednesday, suggesting inflation may have peaked in annual terms at 7.8% the previous month.

Inflation has been driven higher this year by fuel and food prices in particular, moving well beyond the central bank’s target range of 3% to 6%.

The South African Reserve Bank is expected to announce another 75 basis points increase in its main lending rate on Thursday to bring inflation back within its desired range.

Statistics South Africa figures showed that consumer inflation was at 0.2% month on month in August from 1.5% in the previous month.

Core inflation, which excludes prices of food, non-alcoholic beverages, fuel and energy, fell to 4.4% year on year in August, from 4.6% previously. On a month-on-month basis core inflation was at 0.2% from 0.7% in July.

Source: Moneyweb

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AfricaEconomyGlobal News

Global recession looms amid broadest rate hikes in five decades, World Bank says

by Radarr Africa
written by Radarr Africa

The global economy may face a recession next year caused by an aggressive wave of policy tightening that could yet prove inadequate to temper inflation, the World Bank said in a new report.

Policy makers around the world are rolling back monetary and fiscal support at a degree of synchronisation not seen in half a century, according to the study released in Washington on Thursday. That sets off larger-than-envisioned impacts in sapping financial conditions and deepening the global growth slowdown, it said.

Investors expect central banks to raise global monetary policy rates to almost 4% next year, double the average in 2021, just to keep core inflation at the 5% level. Rates could go as high as 6% if central banks look to wrangle inflation within their target bands, according to the report’s model.

The World Bank study estimates 2023 global gross domestic product growth to slow to 0.5%, and contract 0.4% in per capita terms that would meet the technical definition of a global recession. After record expansion in 2021, this would cut short recovery well before economic activity has returned to its pre-pandemic trend, it said.

“Policy makers could shift their focus from reducing consumption to boosting production,” said World Bank Group President David Malpass. “Policies should seek to generate additional investment and improve productivity and capital allocation, which are critical for growth and poverty reduction.”

The study by World Bank economists Justin-Damien Guenette, M. Ayhan Kose, and Naotaka Sugawara sees a way for central banks to continue their efforts to control inflation without triggering a global recession, and prescribed an action plan for policy makers:

  • Central banks must communicate policy decisions clearly to help anchor inflation expectations and reduce the degree of tightening needed
    • Advanced-economy central banks should keep in mind the cross-border spillover effects of tightening, while authorities in emerging markets should strengthen macro-prudential regulations and build foreign-exchange reserves
  • Fiscal authorities need to carefully calibrate the withdrawal of support measures while ensuring consistency with monetary-policy objectives
    • The number of countries tightening fiscal policies next year is expected to reach its highest level since the early 1990s, amplifying the effects of monetary policy on growth. Policy makers need to put in place credible medium-term fiscal plans and provide targeted relief to vulnerable households
  • Other economic policy makers need to join the fight against inflation by taking strong steps to boost global supply

Source: Bloomberg

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AfricaAFRICA NEWSEconomyGhanaNewsWestern Africa

Ghana’s inflation hit 33.9%, the highest since 2001

by Radarr Africa
written by Radarr Africa

Ghana’s consumer inflation reached nearly 34% in August, the highest since 2001, despite a historic rate increase by the central bank.
Consumer inflation in the West African country climbed to 33.9% annually in August from 31.7% in July, according to new figures released by the statistical service Wednesday.

Addressing the media in Accra Wednesday, the head of the service, Samuel Kobina Annim, said the inflation rate was mainly driven by high fuel prices that are affecting transport fares and utility costs.

The surge in prices, high cost of living and the steep fall of the Ghanaian cedi sparked street protests in the capital in June.
Annim cautioned against focusing too much on bad news.

“We need to be careful when we are only looking at just the negative side of what potentially might happen to our economy going forward with all the increases and the global economy. Inasmuch as all those challenges are confronting us, we should also look at some positives that are happening in terms of government interventions.”

ALSO READ: Nigeria’s inflation rises to a 17-year-high of 20.52% in August

Last month, Ghana’s central bank raised its benchmark interest rate to a record-high 22% in a bid to curb inflation.

The government is also in talks with the International Monetary Fund for a bailout of around $3 billion to strengthen the ailing economy.

Source: VOA

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AfricaAFRICA NEWSBusinessEconomyNewsNigeriaWestern Africa

Nigeria’s inflation rises to a 17-year-high of 20.52% in August

by Radarr Africa
written by Radarr Africa

Nigeria’s inflation rate surged to 20.52% in August, according to the National Bureau of Statistics consumer price index (CPI) report for August 2022, released on Thursday.

The consumer price index (CPI), which measures the rate of change in prices of goods and services, surged to 20.52 percent in August 2022, up from 19.64 percent in the previous month.

The rate is the highest since October 2005.

According to NBS, the rate was 3.52 percent higher than the 17.01 percent recorded in August 2021.

According to the report, increases were recorded in all classifications of individual consumption according to purpose (COICOP) divisions that yielded the headline index.

“On a month-on-month basis, the headline inflation rate in August 2022 was 1.77 percent, this was 0.05 percent lower than the rate recorded in July 2022 (1.82 percent). This means that in August 2022 the headline inflation rate (month–on–month basis) declined by 0.05 percent,” the report reads.

“The percentage change in the average CPI for the twelve months period ending August 2022 over the average of the CPI for the previous twelve months period was 17.07 percent, showing a 0.47 percent increase compared to 16.60 percent recorded in August 2021.”

The report added that food inflation rose to 23.12 percent in August 2022 on a year-on-year basis, representing a 2.82 percent increase when compared to 20.30 percent in August 2021.

“This rise in the food inflation was caused by increases in prices of bread and cereals, food products like potatoes, yam and other tubers, fish, meat, oil and fat,” it added.

“On a month-on-month basis, the food inflation rate in August was 1.98 percent, this was a 0.07 percent decline compared to the rate recorded in July 2022 (2.04 percent).

“This decline is attributed to the reduction in prices of some food items like tubers, garri, local rice and vegetables.

“The average annual rate of food inflation for the twelve-month period ending August 2022 over the previous twelve-month average was 19.02 percent, which was a 1.48 percent decline from the average annual rate of change recorded in August 2021 (20.50 percent).”

The report further analysed price movements for states, Anambra and Ondo were the highest.

ALSO READ: Nigerian government partners with France to improve electricity supply

“In August 2022, food inflation on a year-on-year basis was highest in Kwara (30.80 percent), Ebonyi (28.06 percent) and Rivers (27.64 percent), while Jigawa (17.77 percent), Zamfara (18.79 percent) and Oyo (19.80 percent) recorded the slowest rise on year-on-year food inflation.

“On a month-on-month basis, however, August 2022 food inflation was highest in Anambra (3.05 percent), Ondo (2.92 percent) and Bauchi (2.78 percent), while Yobe (0.46 percent), Oyo (0.89 percent) and Delta (0.94 percent) recorded the slowest rise on month-on-month inflation.”

Source: TheCable

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AfricaAFRICA NEWSBusinessEconomyNewsSouth AfricaSouthern Africa

South African Rand firms as dollar weaken before US inflation data

by Radarr Africa
written by Radarr Africa

The rand strengthened in early trade on Monday, as the dollar weakened ahead of key US inflation data this week that might give the Federal Reserve room to slow the pace of rate hikes at its Sept. 21 policy meeting.

At 0703 GMT, the rand traded at 17.17 against the dollar, 0.92% stronger than its previous close.

Economists at ETM Analytics said in a note that the dollar/rand has consolidated around the 17.30 mark overnight, with the market seemingly awaiting fresh directional impetus that may come from tomorrow’s US CPI data.

“Pulling back the lens slightly, there is still plenty of two-way risk in the market, as the USD’s extreme overvaluation is weighed against market risk and uncertainty surrounding the Fed’s policy outlook, Europe’s energy crisis, and China’s economic slowdown,” ETM Analytics said.

On the stock market, the Top-40 and the broader all-share rose almost 1% in early trade.

The government’s benchmark 2030 bond rose in early deals, with the yield down 7 basis points to 10.235%.

Source: Moneyweb

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AgricultureBusinessEconomyMoroccoUncategorized

Agriculture and Cereal Export Prices in Morocco Are Stabilizing says World Bank

by Radarr Africa
written by Radarr Africa

While price inflation in Morocco continues to break records, a recent report from the World Bank argues that agricultural and  Cereal export prices have started showing signs of stabilizing worldwide.

Despite showing moderate signs of easing, price shocks are still driving inflation high, with inflation levels being especially high in low and middle-income countries, including morocco, the report indicates.

It also argues that high inflation is currently creeping its way to even high-income countries, which were previously thought to be immune to inflationary trends.

In Morocco, data compiled by the World Bank shows the alarming trend of rising inflation over the past five months. The country’s inflation figures broke through the 5% threshold in February, maintaining an upward trajectory for five months in a row and reaching 10.6% in June.

Global anxiety and disruptions to continue

Amid the generalized uncertainty triggered by the remnants of COVID-induced anxiety and the repercussions of the Ukraine war, the prospect of price recovery is further clouded by the continuous disruptions to the global supply chain.

The outlook of global trading is “not promising,” World Trade Organization (WTO) Director-General, Ngozi Okonjo-Iweala, said in a recent interview with Bloomberg, highlighting the multiple risk factors that could threaten the short-term recovery of global trade.

As Russia’s war on Ukraine is increasingly exerting more pressure on global energy and food supplies, Okonjo-Iweala argued, COVID-induced shipping bottlenecks are still retraining the global trade. 

ALSO READ: Chery to launch a New Tiggo 8 Pro Max in Moroccan Market

In Asia, China’s “Covid Zero” strategy means that the world’s largest manufacturing regions are in peril of being shut down at any moment to deter the spread of COVID-19, the WTO chief told Bloomberg.

Climate change has equally affected supply chains in some of the world’s largest economies, translating to low production of key food commodities such as grain.

In light of the risks still looming over the global supply chain, the WTO is set to downgrade its forecast for growth even further. The global trade regulator has already cut the growth projections to 3% in April, down from 4.7%.

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