The annual inflation rate in Nigeria rose to a new 28-year high of 33.95% in May, according to official data released on Saturday. This deepens the crisis that has fueled public anger against President Bola Tinubu’s economic reforms. It was the 18th consecutive month in which inflation has risen, up from 33.69% the previous month.
Price pressures have been fueled by Tinubu’s reforms, particularly the cutting of subsidies for gasoline and electricity, and the devaluation of the Naira currency twice within a year. Labor unions, which have suspended a strike demanding a new minimum wage, argue that the reforms are harming the poor and leaving millions of people struggling with the worst cost of living crisis in decades.
Data released by the National Bureau of Statistics shows that food and non-alcoholic beverages continued to contribute the most to inflation in May. Food inflation, which makes up the largest part of Nigeria’s inflation basket, rose from 40.53% the previous month to 40.66%.
According to analysts, high food prices and a weaker Naira are the main drivers of inflation in Nigeria. In response to the ongoing rise in inflation, the Central Bank raised interest rates in May for the third time this year. Governor Olayemi Cardoso has indicated that interest rates will remain high for as long as necessary to lower inflation.
The situation in Nigeria is dire, with the cost of living skyrocketing and putting immense pressure on the population. The government’s economic reforms have not had the intended effect of stabilizing the economy, and instead, they have exacerbated the inflation crisis. It is crucial for policymakers to come up with effective solutions to address the root causes of inflation and provide relief to the people who are bearing the brunt of these economic challenges.