Hard times await Nigerians as cost of living reaches all-time high

More economic hardship awaits Nigerians following the lingering crisis in the country as it could worsen the already compromised economy as evident in the rising cost of living.

Cost of living reached post-recession’s all-time high in September when the inflation rate hit 13.71 per cent. It was the highest in 31 months, after the 2017 price crisis.

The country witnessed relatively moderate growth in inflation for almost two years until recently when the figure escalated at a rate many described as alarming.

In September, the composite inflation rate gained 0.49 per cent points to hit 13.71 per cent (YoY). In August, it gained 0.40 per cent to reach 13.22 per cent, unsettling prevailing trends at every point.

The inflation rate of food, the prime essential item, has also remained above composite figures. In September, food inflation was 16.66 percent YoY, 66 per cent point above what was recorded in August, and 2.95 per cent point above the all-item inflation rate.

Food inflation in northern states has continued to be a major source of worry with most food producing states in the region under serious security threat.

Kogi, along with other northern states, has consistently topped food inflation in the past few months, raising concern about food security in the country.

On state-by-state analysis, Zamfara, Kogi Sokoto, Taraba, Yobe, Plateau, Kebbi, Kaduna and Jigawa exceeded the national food inflation rate average, sustaining the concern about the country’s capacity to feed its citizens.

Contrary to speculation that the protest would trigger massive dumping of shares at the nation’s bourse, the market capitalisation of the Nigerian Stock Exchange (NSE), has remained upbeat.

The market capitalisation gained N188 billion, rising from N14, 811 trillion recorded on October 12, 2020, the first day of protest to close at N14, 999 trillion on the last trading day of last week.  The All-share Index (ASI) appreciated by 359.57 points or 1.25 per cent, from 28, 337.49 to 28, 697.06.

A stockbroker with APT Securities Limited, Jamiu Kayode, said the market might not yield to the socio-political tension because investors were looking for an inflation-adjusted rate of return, which other investment instruments could not give.

“Ours is an emerging market, which is different from advanced markets. Again, we are under a new normal era since the COVID-19 outbreak. So, trading goes on, meaning that circumstances, as we have in Nigeria, will have little or no impact on market performance,” he added.

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In the last twenty days, the country has been under the grip of #EndSARS protesters, who had demanded for the abolition of the Police Special Anti-Robbery Squad over high handedness.

It was, however, hijacked by hoodlums, who, for days, dealt deadly blows on the bleeding economy — looting public and private facilities. This has kept youths and vandals on the streets halting business activities and free flow of movement in major city centres.