Nigeria’s inflation rises to 34.80% in December

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The untamed rise in the Nigeria’s inflation surged to 34.80 percent in December 2024 from 34.60 percent in November, according to the latest Consumer Price Index and inflation data released on Wednesday by the National Bureau of Statistics, NBS.

The December inflation data showed a 0.20 percent due to heightened demand for goods and services during the yuletide.

On a year-on-year basis, the inflation rate marked a significant increase of 5.87 percentage points compared to 28.92 percent in December 2023.

The inflation surge highlights the upward trajectory in consumer prices, driven by economic challenges such as currency depreciation, high energy costs and persistent supply chain disruptions.

“On a year-on-year basis, the headline inflation rate was 5.87 percent higher than the rate recorded in December 2023 (28.92 percent).

“This shows that the headline inflation rate (on a year-on-year basis) increased in December 2024 compared to the same month in the preceding year (i.e., December 2023),” the NBS stated.

Meanwhile, NBS said Nigeria’s food inflation dropped marginally to 39.83 percent in December 2024 from 39.93 percent in November on a year-on-year basis.

Reacting to the development, the Centre for the Promotion of Private Enterprise, CPPE, has gives tips for the moderation of the inflation trajectory.

The Chief Executive Officer of the Centre, Muda Yusuf, said despite the marginal  increase in the December, Nigeria’s inflation would have a positive outlook in 2025 due to moderation in exchange rate volatility and improvement in foreign reserves.

According to him, the inflation outlook for 2025 will be positive due to “sustained moderation in exchange rate volatility and improvements in foreign reserves.

“Prospects of easing geopolitical tensions with the inception of the Trump presidency in a few days time, and a strong base effect, given the high inflationary pressures experienced in 2024.”

The economic think tank group, however, decried the current fixation on the arbitrary revenue targets for ministries, departments, and agencies.

“Excessive pressure on MDAs to boost revenue and increase IGR has profound inflationary implications.

“The reality is that such pressures are invariably transmitted to investors in the form of higher fees, levies, penalties, import duties, regulatory charges, etc. These outcomes are in conflict with government aspirations to boost investment, curb inflation, and create jobs.

“Revenue targets should be based on empirical studies, absorptive capacity of the economy, and due consideration of the wider economic implications.

“Obsession with revenue would hurt investments, worsen inflationary pressures, aggravate poverty, and impede economic growth.

“There should be a careful balancing act between revenue growth aspirations, desire to boost investment, and commitment to moderate inflation,” the CPPE executive stated.

The CPPE highlighted the need to moderate on pause of monetary tightening policy by the Central Bank of Nigeria, and reducing fiscal risks to tame the inflation growth.

It also suggested “Pause on monetary policy tightening and interest rate hikes by the CBN to reduce business operating costs.

“Reduction in fiscal risks to macroeconomic stability through a reduction in fiscal deficit and deceleration in growth of public debt.”

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