Key aspects
- Global inflation is forecast to decline from 7.5% in 2022 to 5.2% in 2023.
- Reduced forecast mainly due to lower food and energy prices and reduced global demand.
- Annual inflation is expected to remain well above the long-term average, particularly in West Asia, South Asia and Africa.
The United Nations has revealed that the global inflation rate is expected to decrease from 7.5% in 2022 to 5.2% in 2023.
The UN said its forecast is based on lower food and energy prices and lower global demand
This is what he revealed in his report entitled “Global Economic Situation and Outlook to Mid-2023″.
inflation
The UN acknowledged that inflation has eased in recent months as it is expected to remain above the central bank’s targets in 2023.
- “Global inflation is forecast to decline from 7.5% in 2022 to 5.2% in 2023, mainly due to lower food and energy prices and lower global demand. Inflation, but , will remain well above the 2000-2019 average of 3.1%.”
Food prices
They noted that global food prices have fallen since mid-2022 due to several factors, including the resumption of exports from Ukrainian ports under the Black Sea Grains Initiative, saying:
- “The FAO food price index decreased by 20% year-on-year in March 2023 to 126.9, the lowest value since July 2021.
- “While the unexpected OPEC+ production cut in April coupled with the European Union’s ban on Russian crude put temporary upward pressure on prices, oil prices continued to decline.
- “Between January and early May 2023, Brent crude prices fell 16 percent to around $75 a barrel, the lowest level since December 2021.
Developing countries and developed countries
In developed countries, headline inflation is expected to ease gradually from 7.8% in 2022 to 4.8% in 2023, but will remain well above central bank targets, typically around 2%.
They added that in the United States, headline inflation has been easing over the past year, falling to 5.0% in March 2023, the lowest rate since May 2021.
- “In the European Union, inflation fell to 8.3% in March, from 3% in Luxembourg and Spain to 25.6% in Hungary.
- “Although headline inflation rates have been falling, core inflation in the United States and Europe remains high, driven mainly by rising prices for services (e.g. housing, insurance, transport) and strong growth salary
- “Inflation is also trending downward in most developing countries amid lower commodity prices and global supply constraints and reduced depreciation pressures. However, annual inflation will remain well above the long-term average, especially in West Asia, South Asia and Africa.
The UN warned that while global food prices have eased since mid-2022, domestic food inflation has often remained high due to a range of factors, including still high import costs high prices, local supply disruptions and market imperfections.
- “According to the World Bank, food inflation at the beginning of 2023 remained above 5% in about 90% of developing countries.
- Continued high inflation in developing countries that host large numbers of people living in poverty represents an additional barrier to poverty eradication.
- “Emerging evidence from countries affected by the current episode of high food prices reconfirms previous evidence that women and children are most affected by the resulting hunger and malnutrition.
What you should know
Nigeria’s inflation rate rose to 22.2% in April 2023, the highest since January 2004, 19 years ago. In fact, Nigeria has recorded a record inflation rate every month since July 2022. It’s like we hit new record highs every month that inflation figures are released.
The largest increases were recorded in the prices of gas, air transport, liquid fuel, vehicle parts, fuels and lubricants for personal transport equipment, medical services and road transport.
The contributions of divisional level matches to the increase in the holder index are; food and non-alcoholic beverages (11.51%), domestic water, electricity, gas and other fuels (3.72%), clothing and footwear (1.7%) and transport (1.45%).
