The National Bureau of Statistics is set to release June inflation figures on Monday 18th of July, 2016. There series of prediction to what the rate might be.
Last month, the NBS stated in its consumer price index, CPI report that inflation rate rose from 13.7% to 15.6% between April and May. There are series of pointers to this huge jump and the NBS did an extensive rationale on the data.
NBS will publish June 2016 Consumer price inflation, PMS/Petrol Price watch and introduce Diesel Price watch reports on Monday 18th of July
— Dr Yemi Kale (@sgyemikale) July 13, 2016
The data is also unsettling to many analysts considering the fact that from a year to date view, inflation grew by 11.4% (year-on-year) in February, roughly 1.76% points higher from rates recorded in January 9.6%.
Analysts are already predicting that June inflation might rise to 16%. However, some quarters predicted a non-movement insisting that inflation will hover around 15%. Nonetheless, all sides to the coming numbers are sensible, however, the persistent and worsening macro-economic outlook of the country might see these two sides been too conservative.
One of the major driver of inflation for the month of May was reality of the sharp increase in the price of premium motor spirit, PMS in the aftermath of the 100% subsidy removal. The urban index for May rose by urban index rose by roughly 2.1 percent points from 15.1 per cent to 17.1 per cent. This is because, while the consumption of petrol reduced by 40% people now pay more for fuel and other interlinked products and services that require fuel in their value chain.
The hangover of fuel price increase will still play a major determining factor for June inflation data.
The newly introduced single market Forex system will also take its toll on the data. While the Naira-settled OTC FX Futures market did commenced operations on the 28th of June, its impact in stabilising the Naira will take more time to yield results. As a result of this, importers are still not able to access forex even at the NGN282-NGN283 to USD1. This is why the food sub-index is expected to rise higher.
Last month, the food sub- index increased by 14.9 per cent in May, up by 1.7 per cent points from rates recorded in April as all major food groups, it contributed to the food sub-index increased at faster pace driven by higher food prices in fish, bread and cereals and vegetable. The month of June is expected to show the true colour of how bad prices have gone in Nigeria’s foods market.
June inflation would be many things but a stagnation or drop. June inflation is expected to be a decider for the outlook of Nigeria’s economy. The economy is already battered.
The markets is in a bearish mood, banks are not lending but front-loading deposits into treasury bills and fixed income, Monday is expected to unravel what to expect for the second half of the year.
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