Food products on display in the market
Financial market analysts at FSDH Securities Limited have forecast a year-on-year increase in the December 2012 inflation rate expected to be released next week.
In fact, the firm,which stated this in a report made available to THISDAY yesterday, estimated that the year-on-year inflation in December would climb to 12.5 per cent, representing an increase by 20 basis points, from the 12.3 per cent recorded in November
The National Bureau of Statistics (NBS) is expected to release inflation figures for December 2012 next week ahead of the Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) scheduled to commence on January 21. Inflation for November 2012 stood at 12.3 per cent, an increase from 11.7 per cent recorded in October 2012.
FSDH hinged its prediction on the general increase in prices of consumer goods monitored during the month.
It explained: “An analysis of the consumer good prices that FSDH Research monitored across the country in December shows a general increase in prices across the major components of the food basket and household materials. The average price of tomatoes increased by about 75 per cent, the price of onions increased further by about 40 per cent, the price of garri increased by about 30 per cent and the price of potatoes (Irish) increased by about 40 per cent.
“The price of rice, which accounts for about nine per cent of the household expenditure in Nigeria, rose marginally by 0.74 per cent, other food items that increased during the period are: meat, sea foods, oil & fats, yam, vegetables and fruits. The increase in transport fares and the high demand usually associated with the Christmas and New Year celebrations were responsible for these various increases. In addition, the rise in the prices of some of the food items can be attributed to the seasonality and processing of the product.”
The analysts also pointed out that the speculation about the possible total removal of fuel subsidy in January 2013 caused hoarding of petroleum products in December. This it noted, also led to long queues at the filling stations and patronage of black market.
“All these contributed to increase in transportation fares across the country. Increases were also recorded in clothing, footwear and some household items as a result of the festivity during the period,” they said.