Nigerian inflation hits 17.6 pct amid recession

By Rafiu Ajakaye

LAGOS, Nigeria

Nigeria's headline inflation hit 17.6 percent in August, up from 17.1 percent recorded the previous month, driven mainly by a rise in the price of consumer goods.

In a report on Friday released by the National Bureau of Statistics, the rising cost of gasoline and building materials was blamed for the spike in inflation as was a rise in the prices of consumer goods, especially food.

Analysts say the inflation is a byproduct from the shortage of foreign exchange accruable to the government because of falling oil prices -- Nigeria’s main forex earner.

Low forex means the country is unable to support importation, leading importers to shop for dollars from unofficial sources at higher rates.

“Imported food items as well as other necessary inputs to producing key local staples such as bread continue to drive the food index higher,” the bureau stated.

Finance Minister Kemi Adeosun said on Friday the government is pumping $1.1 billion into boosting plunging consumer spending. The Nigerian economy entered recession last month after its GDP consecutively dived across two quarters.

She said the government had spent $2.5 billion on capital projects since May when the budget was signed into law.

The minister said $197 million of the $1.1 billion will go into feeding schoolchildren as part of the government's social welfare scheme to boost enrollment and combat malnutrition.