The National Bureau of Statistics’ (NBS) Consumer Price Index (CPI) and Inflation Report for August, has indicated that headline inflation fell for the second consecutive month in 2024 to 32.15 percent, representing a 1.25 percentage point decline from 33.40 percent month-to-month in July.
However, on a year-over-year basis, the inflation rate rose by 6.35 percentage points, compared to 25.80 percent in August 2023. Similarly, food inflation fell to 37.52 percent or a 2.01 percentage point decline from 39.53 percent month-to-month in July but an 8.18 percentage point increase from 29.3 percent year-on-year in August 2023.
The NBS report said the decrease in food inflation can be attributed to lower average costs for products like yam, cassava and groundnut oil, which resulted from continued agricultural output in the country.
On the other hand, rise in year-on-year food inflation could be linked to seasonal variables and an increase in the average costs of identical commodities.
“While the current decline in inflation is a positive development for the economy, a long-term solution is needed to further reduce inflation.
“Specifically, since the current decline in inflation is primarily driven by agricultural production, the government should increase agricultural production by making significant investments in the agricultural sector, particularly in modern farming techniques, storage facilities, irrigation systems, and rural area infrastructure.
“This will ensure the year-round supply of food items. Also, the government should stabilize other factors that are driving up inflation, such as exchange rate instability, the energy crisis and fiscal policy indiscipline,” the report stressed.
