By BABAJIDE KOMOLAFE

The continuing rise in inflation rate, as reported by the National Bureau of Statistics, is more of a concern, says Razia Khan.

“The inflation data is more of a concern, with the uptrend in year-on-year inflation continuing, she said in email response to the 10.5 per cent inflation rate reported by the NBS on Tuesday.

The Bureau reported that inflation rate rose from 10.3 per cent in September to 10.5 per cent in October, majorly due to increasing energy cost. This indicated that recent monetary tightening by the Central Bank of Nigeria (CBN) is yet to impact prices of goods and services.

The CBN, in an attempt to further curb inflationary pressures, had increased its monetary policy rate (MPR) and the cash reserve requirement for banks (CRR).

At an extra ordinary meeting of its Monetary Policy Committee (MPC) on October 10th, the CBN raised the MPR by 275 basis ponts to 12 per cent from 9.25 per cent, while increasing the CRR by 400 basis to 8 per cent from 4 per cent. This bold and aggressive move however appears late to halt the continued rise in inflation.

Khan, Regional Head, Research, Africa, Standard Chartered Bank, however said, “It is likely to be some lag at work between monetary tightening and the impact on the real economy.”

According to the NBS, “The Composite Consumer Price Index, which measures inflation rose to 10.5 per cent year-on-year in October 2011. This is higher than 10.3 per cent recorded in the previous month in the new CPI series. The monthly change of the current composite CPI was 0.49 per cent increase when compared with September 2011.

“The year-on-year average consumer price level as at October 2011 for Urban and Rural dwellers rose to 7.8 and 12.8 per cent respectively.

“The urban All Items monthly index declined by 0.1 per cent on month-on-month, while the corresponding rural index rose by 0.9 per cent when compared with their preceding month.

“The biggest contri-butors to the consumer inflation were the high prices of kerosene and diesel.

“Percentage change in the average composite CPI for the twelve-month period ending October 2011 over the average of the CPI for the previous twelve-month period was 11.1. This was slightly lower than the 11.4 per cent recorded for the preceding month.

“The corresponding 12-month average percent change for urban and rural indices were 8.9 and 13.0 respectively.

“The “All items less Farm Produce” index, which excludes the prices of agricultural products, increased by 1.1 per cent in October 2011 on month-on-month change, when compared with September 2011. The increase was mainly on some household items, building materials, diesel, and kerosene and electricity charge.

“In the twelve-month to October 2011, the index rose to 11.5 per cent while the average annual rate of rise of the index was 11.7 per cent for the twelve-month period ending October 2011.”