Inflation soars past four-year high as food prices continue to spike

Nigerian inflation rose above a four-year high in March as food prices jumped more than 20 percent, the latest figures published by the National Bureau of Statistics (NBS) have shown.

Inflation, in double digits since 2016, reached 18.17% percent, driven by several factors including the dip in the prices of oil, Nigeria’s main export, and weakened naira.

The latest inflation reading was the highest since the 17.78 percent in February 2017.

Food prices, which make up the bulk of the inflation basket, rose 22.95 percent in March, a jump from 21.79 percent in February.

Staples including bread, cereals, potatoes, fruits, and oil drove the increase in the food price index, the NBS said in its report.

Core inflation, which excludes the prices of volatile agricultural produce rose to 12.67% from 12.38% recorded in February 2021.

Bismarck Rewane, managing director at Lagos-based Financial Derivatives, told Al-Jazeera that the “stagflation crisis” would take a long time to resolve, with inflation eating up economic gains to the point where any government stimulus might be too weak to generate jobs.

Meanwhile, the International Monetary Fund, which said in February that the bank might need to tighten policy if inflation got out of control, has urged it to phase out financing of the government deficit to help check price pressures and to allow the naira to float more freely.