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Nigerian inflation rises in May to new 28-year high

NIGERIA’S annual inflation (NGCPIY=ECI) rose to a new 28-year high of 33.95% in May, official data showed, worsening hardships that have fuelled public anger against President Bola Tinubu’s economic reforms.

It was the 18th straight month that inflation has risen, up from 33.69% a month earlier.

Price pressures have been spurred by Tinubu’s reforms, chiefly slashing petrol and electricity subsidies and devaluing the naira currency twice within a year.

Labour unions, which suspended a strike called to demand a new minimum wage, have argued that the reforms hurt the poor and have left millions grappling with the worst cost-of-living crisis in decades.

Data published by the National Bureau of Statistics showed food and non-alcoholic beverages continued to be the biggest contributor to inflation in May.

Food inflation (NGFINF=ECI) which accounts for the bulk of Nigeria’s inflation basket, rose to 40.66% from 40.53% the previous month.

High food prices and a weaker naira are the main drivers of inflation in Nigeria, analysts say.

The central bank raised interest rates in May for the third time this year in response to the continued rise in inflation.

Governor Olayemi Cardoso has indicated that rates will stay high for as long as necessary to bring inflation down.