Headline Inflation Moderates Further to 17.01% Y/Y in August 2021

September 15, 2021/Cordros Update

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In line with our expectation, Nigeria’s headline inflation moderated for the fifth consecutive month to 17.01% y/y in August 2021 (July: 17.38% y/y). The outturn is 6bps higher than Cordros’ estimate (16.95% y/y) and in line with Bloomberg’s median consensus estimate (17.00% y/y). On a month-on-month basis, headline inflation increased by 9bps to 1.02%.

Food inflation sustained its deceleration for the fifth consecutive month, declining by 73bps to 20.30% y/y in August 2021 (July: 21.03% y/y). Notably, the highest price increases were recorded in Bread and cereals, Milk, cheese and egg, Oils and fats, Potatoes, yam and other tubers, Food products, Meat and Coffee, tea and cocoa. On a month-on-month basis, food inflation increased by 1.06% in August (July: 0.86%).    

Similarly, core inflation slowed by 31bps to 13.41% y/y (July: 13.72% y/y). Pressures were most significant in the prices of Shoes and other footwear, Household textile, Motor cars, Garments, Game of chance, Major household appliances whether electrical or not, Hospital services, Catering services, Appliances, articles and products for personal care and Clothing materials, other articles of clothing and clothing accessories. Compared to the previous month, the core index declined by 54bps to 0.77% m/m in August.   

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