Finally, Nigeria inflation rate drops - the first time in 15 months

The annual food inflation was 2.08 per cent in rural areas and 1.87 per cent in the urban areas.

The consumer-price index, measuring what Americans pay for everything from cars to dental care, increased 0.1% in February from a month earlier, the Labor Department said Wednesday.

"On a Headline basis, the Consumer Price Index (CPI) which measures inflation increased by 17.78 percent (year-on-year) albeit at a slower pace in February 2017, 0.94 percent points lower from the rate recorded in January (18.72) percent", NBS said on Tuesday.

February Consumer Price Index (CPI) indicated that inflation rate dropped to 17.78 per cent for the first time in 15 months.

The index for "Transport, Equipment & Parts" group rose by 0.5 percent to 140.5 (provisional) from 139.8 (provisional) for the previous month due to higher price of auto rickshaw / tempo / matador (4 percent) and auto parts (1 percent).

The Wholesale Price Index based inflation, reflecting the annual rate of price rise, in January was at 5.25 per cent. Nevertheless, the likelihood of a repo rate cut by the RBI in April 2017 remains subdued, given its focus on bringing inflation to 4 per cent in a durable manner. In February, the CPI index was set at 243.603, an increase of 0.31% over the January number.

"We had expected an adverse base effect to push up WPI inflation in February 2017 to 5.9%", Aditi Nayar, Principal Economist at ICRA, said.

CPI inflation rose to 3.7 per cent y-o-y in February versus 3.2 per cent in January, largely in line with expectations (Consensus: 3.6 per cent; Nomura: 3.7 per cent).

Similarly, the food index rose by 18.53 per cent (year-on-year) in February, up by 0.71 per cent points over what was recorded in January (17.82 per cent). However, the price of gram (14%), arhar (7%), condiments & spices (6%), urad (5%), tea and masur (3% each), egg, moong and maize (2% each) and wheat and coffee (1% each) declined.

In the PMS report, the bureau stated that the average price paid by consumers for petrol increased by 50.1 per cent year-on-year and 0.7 per cent month-on-month to N149.8 per litre in February from N148.7 in January.

There were slower price increases in the cost of communication, recreation and culture.

ICICI Bank in its report said, "As stickiness in core inflation has been a cause of concern and will be watched going ahead to assess the sustainable achievement of the 4% medium term target".

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