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UPDATE 2-Nigeria inflation rises in June, food and healthcare cost weigh

Published 17/07/2020, 09:42
Updated 17/07/2020, 16:54

(Updates with details, background)
By Alexis Akwagyiram
LAGOS, July 17 (Reuters) - Annual inflation in Nigeria rose
for a 10th straight month in June, lifted by food and healthcare
costs, the statistics office said on Friday, after the
coronavirus pandemic disrupted logistics and the central bank
weakened the currency.
Inflation climbed to 12.56%, its highest level in more than
two years, from 12.4% in May, the National Bureau of Statistics
said.
The central bank is due to meet on Monday to set interest
rates after it last week depreciated the naira by 5.5% against
the dollar on the official market, its second adjustment in six
months. Rising inflation has caused yields on Treasury bills and
bonds to turn negative, a major stumbling block for the central
bank's push to attract foreign inflows to support the naira
NGN= and boost the economy.
The statistics office said prices of medical services,
pharmaceutical products, transport and associated services, rose
the most on the non-food index.
A separate index for food, which accounts for the bulk of
the inflation basket, showed a price increase of 15.18% from
15.04% in May. Food inflation has been in double digits for more
than three years.
The rise in the food index was caused by increases in bread
and cereals, potatoes, yam and meat, fish and vegetables.
Africa's top oil exporter faces economic hardship from the
coronavirus outbreak and sharp falls in crude prices, which have
caused a steep decline in growth.
The government expects the economy to contract by as much as
8.9% this year.
Nigeria has more than 34,000 confirmed cases of coronavirus
and 76 deaths. Most cases are in urban areas, where the brunt of
price increases is felt, especially for imported drugs and food.

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