Solvency amid festivity, inflation: Eyeing the framework of choice and alternatives
As the yuletide festivities draw close, it is only very much in view that the streams of activities and events would be inseparable from the configurations of economic realities. The choices and spendings of many would largely be framed within the patterns of purchasing power and market realities. It’s very much resounding that the strains in the Country’s economy would have to force on many the need to take reformative decisions to keep solvent; thereby breaking from usual speeding patterns while foregoing certain avoidable commodities for possible alternatives.
The reflex of double-digit inflation has been a recent course in the inflation profile of the Country’s economy realities recently. Although a decline in headline inflation began to take record since April when it fell to 18.12per cent from 18.17per cent in March, the drop have not translated to actual decrease in the prices of goods.
The National Bureau of Statistics (NBS) in its Consumer Price Index report released on Wednesday, disclosed the inflation rate for November fell by 0.59 per cent from 15.99 per cent in October. This translated the inflation rate in Nigeria in November fell to 15.40 per cent (year-on-year), the lowest since December last year.
According to the NBS, on a month-on-month (MoM) basis, the headline index increased by 1.08 per cent in November, which is 0.10 per cent higher than the rate recorded in October. “The percentage change in the average composite CPI for the 12 months period ending November 2021 over the average of the CPI for the previous 12 months period was 16.98 per cent, showing 0.02 per cent point from 16.96 per cent recorded in October 2021.” The report revealed urban inflation rate increased by 15.92per cent (year-on-year) in November from 15.47 per cent in November 2020, while the rural inflation rate increased by 14.89 per cent in November 2021from 14.33 per cent in November 2020. The rural index also rose by 1.04 per cent in November, compared to 0.95 per cent in October.
Food inflation moderated by 1.09 percentage points (ppts) year-on-year (YoY) to 17.21 percent owing to the supportive base effect. This is coming at the backdrop of Yuletide demand pressure witnessed on the month-on-month (MoM) food inflation reading. Conversely, the core inflation was up by 61 bps, reflecting continued price pressure on cooking gas. The NBS noted that the rise in the food index was driven by increases in prices of bread and cereals, fish, food products such as potatoes, yam and other tuber, oil and fats, milk, cheese and eggs and coffee, tea and cocoa.
The National Bureau of Statistics, NBS, had noted that the annual inflation rate dropped for the seventh consecutive month to 15.4 per cent in November from 15.99 per cent in October. This represents a cumulative 2.77 percentage point decline since March when the inflation rate peaked at 18.17 per cent.
In its Consumer Price Index report for November 2021, the NBS stated: “Consumer Price Index, (CPI) which measures inflation increased by 15.40 percent (year-on-year) in November 2021. This is 0.51 percent points higher than the rate recorded in November 2020 (14.89) percent. Increases were recorded in all COICOP divisions that yielded the Headline index.”
On month-on-month basis, the Headline index increased by 1.08 percent in November 2021, about 0.10 percent rate higher than the 0.98 percent recorded in October 2021.
NBS report read partly, “The percentage change in the average composite CPI for the twelve months period ending November 2021 over the average of the CPI for the previous twelve months period was 16.98 percent, showing 0.02 percent point increase from 16.96 percent recorded in October 2021. The urban inflation rate increased by 15.92 percent (year-on-year) in November 2021 from 15.47 percent recorded in November 2020, while the rural inflation rate increased by 14.89 percent in November 2021 from 14.33 percent in November 2020.”
While some have projected a further moderation in headline inflation to below 15 percent YoY in December 2021 on the sustained impact of the base effect, the festivity induced demand have been projected from some quarters to stir up rising notations of MoM inflationary reading. While other seasonal commodities such as clothing and fabrics among others, have been projected to record increase, the record for foods as a basic need would no doubt record inflation for the season. A ready intervention to foreclose this may not be much feasible insight. It is only pertinent for citizens to be rational in their decisions and choices while giving room for prudent management through micro economic principles to do away with avoidable expenses putting in view the instruments of opportunity cost.
