This week, the consumer price index figures for Nigeria, the US, and the UK are anticipated to be released. In most economies, prices have started to decline, but they are still high in Nigeria.
Nigeria’s oil production for the month of July will be disclosed by the Organisation of Petroleum Exporting Countries (OPEC) today.
Nigeria’s average daily crude oil production increased slightly to 1.276 million barrels per day (bpd) in June, according to OPEC.
The Organisation of Petroleum Exporting Countries, or OPEC, will release its July oil market report on Monday.
Data obtained through direct touch with Nigerian authorities indicates that this is a daily increase of only 25,000 barrels above the 1.251 million barrels per day that were recorded in May.
Nigeria produced 1.362 million barrels of crude oil on average per day in June, down 10,000 barrels from the previous month’s number of 1.372 million barrels per day, according to secondary sources.
Secondary sources claim that although output has decreased, Nigeria remains Africa’s top oil producer, with Libya coming in second with 1.2 million barrels per day in June.
Nigeria has continuously fallen short of both its budget aim of 1.78 million barrels per day and its OPEC production quota of 1.5 million barrels per day for the first half of 2024, as seen by its average crude oil production of 1.27 million barrels per day in June.
The US will publish its July inflation report On Wednesday, the US Bureau of Labour Statistics will make available the July inflation statistics for the US. US inflation was 3.1% in June, down 0.1 percent from May, and nearly at its lowest point in over three years.
Inflation for the month was restrained by the US Consumer Price Index, a broad gauge of costs for goods and services, which witnessed a 3.8 percent decline in petrol prices. This was offset by 0.2 percent rises in the costs of food and shelter.
When volatile food and energy expenses are excluded, the so-called core CPI grew by 3.3 percent from a year ago and by 0.1 percent per month.
The core rate increased by the least amount annually since April 2021.
The consumer price index for the United Kingdom will be released by the Office for National Statistics (ONS) on Wednesday.
In the UK, prices increased by 2% in June 2024, a 2% increase from May, the lowest amount in over three years.
The Bank of England aims to maintain a 2 percent rate of inflation. The Bank raised interest rates to 5.25 percent in an attempt to halt price increases, even though inflation was far higher than that.
The monetary authorities reduced rates to 5% at their most recent meeting in response to a decrease in inflationary pressure.
The ONS claims that a significant increase in hotel prices contributed to the increase in inflation. Package vacations, theatres, movie theatres, and concerts all saw price increases.
Prices for clothes and footwear decreased, and the inflation of food and drink also substantially decreased from its previous highs.
Since October 2022, when inflation reached 11.1 percent—the highest level in 40 years—it has dramatically decreased.
With the natural gas price having dropped significantly since the previous year and the rate of increase in food prices slowing down, investors are placing bets that inflation will continue to reduce during the spring.
The consumer perspective is used by the CPI to measure changes in prices. It is the Bank of England’s stated goal for price stability.
Nigeria’s July inflation data will be made public by the National Bureau of Statistics on Thursday.
Because food prices are rising, Nigeria’s annual inflation rate increased slightly as predicted to 34.19 percent in June, which is the fourth highest rate since 1996.
Numerous analysts’ predictions are refuted by the turnaround from three straight months-over-month headline data showing broad-based reductions in March, April, and May to a growth of 0.17 percent in June 2024.
The food and core inflation baskets rose by 21 basis points and 36 basis points, to 40.87 percent and 27.40 percent, respectively, putting wide pressure on June’s number.
High energy costs, the effect of currency rate fluctuations, and ongoing insecurity worries in the nation’s agricultural producing states have all contributed to inflation’s sustained rampant growth.
Olayemi Cardoso, the governor of the central bank, headed the monetary policy committee (MPC) that raised the nation’s benchmark interest rate to 26.75 percent by a total of 800 basis points in order to combat inflation.
Analysts predict that base effects and a record-breaking harvest later this year will cause inflation to start to decline in July.
“The government’s plan to import 250,000 metric tonnes (MT) of wheat and 250,000 MT of maize also bodes well for the food price outlook, providing a positive counterbalance to the inflationary risks,” they said.
“Overall, we expect headline inflation to moderate by 50 basis points to 33.7 percent,” CardinalStone analysts said
The base impact of inflation, according to Olaolu Boboye, principal economist at CardinalStone Research, indicates that inflation peaked in June and will begin to decline in July.
“Inflation in July will see three major pressure points, which are a hike in fuel price pressure due to scarcity, exchange rate pressure, and sustained food pressures, but it won’t be enough to max out the benefit from the base effect,” Boboye said.
The selling of $876 million through the retail Dutch auction system caused the naira to nearly converge at both the official and alternative markets, as the currency has continued to rise.
According to data from the FMDQ Securities Exchange Limited, following trading on Thursday, the naira gained 0.18 percent as the dollar was quoted at N1,593.62 from N1,596.52 posted on Wednesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
The naira strengthened in the black market, or parallel market, on Thursday when the dollar plummeted to N1,595. This is a rise of 0.94 percent (N15) above the N1,610 quote from the black market’s morning trading.
The CBN, as the top bank, has demonstrated its continued commitment to bolstering liquidity as needed to ensure the smooth operation of the foreign currency market by offering $876 million to satisfy bids made by clients at an auction that ended on Wednesday, August 7, 2024.
As part of its commitment to give all eligible clients transparent access to foreign exchange, the CBN’s leadership has added a second mechanism—the Retail Dutch Auction System (RDAS)—to enable FX sales to end users directly.
The seasonal demand from summer travel and companies looking to import items into the import-dependent country has put pressure on the naira.
