Moving against popular analysts’ expectations of sustained uptrend in Headline Inflation rate in October 2018, the nation’s Headline inflation figure for the month of October turned the curve by 2 basis points. According to the document released this morning by the National Bureau of Statistics, it shifted to 11.26% YoY in October 2018 from the 11.28% YoY reported in the month of September 2018. However, Month-on-month rate increased by 0.74% as against the 0.84% decline recorded in the previous month.
Food Inflation also decelerated slightly by 3 basis points to 13.28% YoY compared to the 13.31%n YoY reported in September, 2018.
Culled from the released document, the highest increases were recorded in prices of fuel and lubricants, vehicle spare parts, domestic and household services, carpets and other floor coverings, Dental services, Hospital services, repair of household appliances and Medical services. The average 12-month annual rate of change of the index was 10.90 percent for the twelve-month period ending October 2018 from 11.09 percent recorded in September.
Factors that impacted the figure in the month of October include;
- Exchange rate stability
- Improvement in the power output
- Lower liquidity in the interbank money market
In our opinion key events that will further impact the nation’s headline inflation for the rest of the year includes;
- The Christmas and New year celebrations
- Rising food prices as a result of the first point above
- Outcome of the ongoing saga between the Federal Government and the Nigerian Labor on minimum wage
- Political spending amongst others