The central bank expects inflation to increase to around 14-15 per cent in the first half of this year, because of high prices of some food items, liquid fuel and transport fares Nigerian inflation was higher than expected in January, data showed on Monday after the government removed fuel import subsidies and then only partially reinstated them, sending prices higher. The government scrapped the subsidies on January 1 but was forced to partially reinstate them to quell protests over the costs of petrol. Fuel prices fell but stayed higher than they had been before the subsidy was removed. Nigeria's consumer inflation rose to 12.6 per cent year-on-year in January, compared with 10.3 per cent the previous month, the National Bureau of Statistics (NBS) said on Monday. Analysts polled by Reuters expected January headline inflation to rise to 11.75 per cent. "The biggest contributors to the consumer inflation were the high prices of some food items, liquid fuel and transport fares, and other miscellaneous goods and services which need liquid fuel and or transport fares for providing their services," an NBS document said. Food inflation, the biggest contributer to the headline figure, rose to 13.1 per cent, up from 11 per cent in December, NBS said. The partial removal of the fuel subsidies push food triggered a spike in food prices in The Central Bank of Nigeria kept its benchmark interest rate on hold at 12 per cent for the second time in a row last month on expectations that any upward movement in inflation from the removal of fuel import subsidies would be short-term. The central bank expects inflation to increase to around 14-15 per cent in the first half of this year, before moderating towards single digits by the end of 2013.
