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·         On Tuesday, the National Bureau of Statistics (NBS) released the Inflation report for the month of March 2019 which showed a moderation in headline inflation, for the third month running, to 11.25% year-on-year (y/y) from 11.31% y/y in the preceding month.

·         On a m/m basis, the headline inflation accelerated by 6 basis points (bps) to print at 0.79% in March 2019: the highest reading in four months.  

·         Similar to y/y headline inflation movement, there was a 2 bps moderation in the food sub-index to 13.45 y/y in March 2019.  

·         The rate of increase in inflation in the Core-Sub Index moderated to 9.46 y/y from 9.79% y/y in February 2019. Similarly, on month-on-month basis, the core sub-index slowed by 12 bps to 0.53% in the month under review, compared with 0.65% recorded in February 2019.

·         The availability of Premium Motor Spirit (PMS) during the course of the month most likely contributed to the stability in PMS prices across the nation as average PMS price in March 2019 was N145.3; same in February 2019.

·         In the coming months, we believe inflation numbers might be pressured mildly by the Easter and Ramadan festivities as well as the onset of the planting season.

·         Going forward, we believe inflationary pressures arising from conflicts in the Northern region disrupting food supply and the eventual signing of the minimum wage bill may cause a spike in general price levels in the near term.

·         While there seemed to be speculations recently about an imminent hike in PMS prices, the FG’s dismissal of subsidy removal in the near term may be a positive for the core sub index.