Inflation in Nigeria isn’t just a number; it’s a real-life economic drama unfolding for millions. As prices soar, the wallets of Nigerians are taking a hit. They’re facing the harsh reality of reduced purchasing power, struggling to afford everyday essentials, and watching their savings lose value. It’s like a financial rollercoaster, with unpredictable interest rates making loans more expensive and economic uncertainty keeping businesses and investments on edge.
In this turbulent environment, wage growth is struggling to keep pace, making it even harder for hardworking Nigerians to maintain their quality of life. The impact is profound, affecting families, businesses, and the overall economic stability of the nation. Nigerians are left with the challenge of adapting through careful budgeting and strategic investments, while policymakers are called upon to tackle inflation head-on for the sake of the people’s well-being.
The Nigerian Exchange Limited opened with a significant loss of N89 billion, reflecting investor concerns. This worrisome development coincided with the release of the latest inflation data by the National Bureau of Statistics for the month of September. The figures revealed an alarming inflation rate of 26.72 percent, marking a notable increase of 0.92 percent compared to August’s inflation rate of 25.80 percent.
Analysis of the data from the NBS highlights the key drivers of year-on-year inflation as Food and non-alcoholic beverages, Housing, water, electricity, gas & other fuel, Clothing and footwear, and Transport, contributing 13.84 percent, 4.47 percent, 2.04 percent, and 1.74 percent respectively.
This inflation figure took center stage for investors throughout the week, along with the release of third-quarter earnings reports from companies listed on the exchange.
Both the All-Share Index and the market capitalization experienced a decrease of 0.24 percent, closing at 67,037.93 basis points and N36.830 trillion respectively.
Trading activity witnessed 5,965 deals involving over 216.07 million units of shares valued at N3.551 billion. Market sentiment remained negative, evident in the performance of 19 gainers and 23 losers.
Among the gainers were NASCON Allied Industries, whose shares rose by 5.45 percent, closing at N58 per unit, and Flour Mill, closing at N31 per share after a 4.20 percent gain. Dangote Sugar appreciated by 3.13 percent, closing at N62.60, while United Bank for Africa’s shares increased by 2.28 percent to close at N17.95. Unilever also gained 0.70 percent, closing at N14.35.
On the downside, Stanbic IBTC witnessed a substantial 10 percent decrease in share value, closing at N72 per unit, and Oando lost 9.24 percent, closing at N8.35. Eterna’s shares dipped by 8.05 percent, closing at N13.70, Cadbury registered a 6.67 percent loss, closing at N14, and Okomu Oil declined by 9.96 percent, closing at N236.80.
In response to the released inflation figures, Professor Uche Uwaleke, a notable figure in the capital market at Nasarawa State University, Keffi, and President of the Association of Capital Market Academics of Nigeria, expressed deep concern. He emphasized the worrying trend of rising inflation in Nigeria, attributing it to factors such as fuel subsidy removal and naira depreciation. Professor Uwaleke particularly highlighted the pressure on food prices, accounting for over 50 percent of the 26.72 percent inflation rate. This trend, he noted, has a significant impact on the purchasing power of the naira, potentially exacerbating poverty levels and contributing to the dollarization of the Nigerian economy and increased demand pressure in the forex market.
