Nigeria's inflation rate moderates to 9.0 per cent

The Nigerian Consumer Price Index (CPI) moderated by 10 basis points in the month of May. It declined to 9.00% year-on-year, compared to the 9.1% in April 2013.

Data released by the National Bureau of Statistics (NBS) showed that increase in price level was muted by the high base of the previous year.

Core Index has been increasing at a declining rate (YoY) since the beginning of the year, while depleting food inventory remains the reason for the rise in food prices (0.5% MoM increase).

The Central Bank of Nigerian (CBN) has kept Monetary Policy Rate, the benchmark rate for lending in the economy, steady at 12 percent with a corridor of +/-200 basis points around the midpoint to head off inflation.

However, analysts are divided as to whether it is time for the banking regulators to shift the rate even as it appears exchange rate volatility may pose greater challenge in the months ahead.