The International Monetary Fund, IMF, has faulted inflation index used by the National Bureau of Statistics, NBS, to measure the country’s monthly consumer price index.
The IMF said the inflation index is extremely outdated and cannot provide a true representative of expenditure patterns of the people in the country.
The IMF in its latest report, stressed the need for the NBS to use new weights from the 2018 National Household Livings Standards, rather than the 2003/2004 National Consumer Expenditure Survey.
It warned that outdated weights could lead to bias in the index presented by the NBS.
The IMF also said there was an ongoing effort for an updated producer price index but noted that the funding for it was uncertain, adding that the second African Regional Technical Assistance Centre in West Africa intended to support Nigeria in the CPI update and improvement.
The report read: “The official monthly consumer price index, CPI, a composite of urban and rural price data, is available on a timely basis. However, the index weights and baskets are based on expenditures derived from the 2003/04 National Consumer Expenditure Survey.
”The weights are severely outdated and are not representative of current expenditure patterns. Outdated weights can introduce a bias into the index.
“The update of the CPI—using new weights from the 2018 National Household Livings Standards Survey—is still ongoing.
”The compilation of an updated producer price index is ongoing but funding for the survey is uncertain. AFW2 plans to provide additional technical assistance to support the CPI update and improvements to Nigeria’s price statistics.”
