Nigeria’s headline inflation eased for the first time in 12 months, settling at 21.34% y/y in December 2022 (November: 21.47% y/y). The outturn is 36bps above Cordros’ estimate (20.98% y/y) and 46bps lower than Bloomberg’s median consensus estimate (21.80% y/y). However, on a month-on-month basis, headline inflation increased by 32bps to 1.71% (November: 1.39% m/m).

Food inflation moderated by 37bps to 23.75% y/y (November: 24.13% y/y). The slowdown in food inflation was despite the increases in prices of Bread and cereals, Oil and fat, Potatoes, Yam and other tubers, Fish and Food Product. On a month-on-month basis, food inflation settled at 1.89%, relative to the 1.40% m/m recorded in November.

Elsewhere, the core inflation increased by 25bps to 18.49% y/y (November: 18.24 y/y).We note that pressures were significant in prices of Gas, Liquid fuel, Passenger transport by Air, Vehicles spare parts, Fuels and lubricants for personal transport equipment, Solid fuel etc.

However, compared to the previous month, the core index eased by 34bps to 1.33% m/m in December 2022 (November: 1.67% m/m).