FOOD INFLATION rises to 16%   

Sep 16 (Lagos) - Annual inflation for August 2020, released by the Nigerian Bureau of Statistics this afternoon, shows inflation rose to 13.22% y/y, its highest since March 2018.

Headline Inflation rose to 13.22% y/y (0.40% higher than 12.82% y/y in July 2020)

The food sub-index rose for a twelfth consecutive month, to 16.00% y/y from 15.48% y/y in July 2020, while the All items less farm produce sub-index also rose to 10.52% y/y from 10.10% y/y in July 2020.

Consumer Price Index (CPI) which measures inflation grew by 1.34% m/m (a rise of +0.09% from what was recorded in July 2020 of 1.25% m/m)

We can expect CBN to start talking about how they plan to control inflation in the next 1 year. We can even expect a memo on it. Their last policies did not work. They failed to control Naira even after devaluation. They do not plan to release a kobo to food importers thereby pushing them to the parallel market. Its a spiral effect that is affecting the consumers and the economy. 

With the recent petrol price hike, we can only expect more inflation no matter what the memos say.

The benchmark lending rate of the CBN is artificially set below the inflation mark. Its like someone on top wants his rate no matter the reality on the ground. These things affect investors decisions, attractiveness of an investment destination and ease of doing business rankings. 

So we have a situation where local investors are getting punished and the consumers are getting flogged by the CBN. Lets see how long they can continue and how long we can tolerate the economic flogging.

reporting for on Wednesday, Sep 16 2020 from Lagos, Nigeria
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