Prices take an inch back
Our Urban Retail Price Tracker – the PURP index – recorded a modest pace of price increase of 0.42% MoM to 111.3 pts in January (vs 0.45% MoM in December). Price pressure remained more evident in the commodities and consumer basket, with the increase in the latter driven largely by reversal of price discounts following weeks of discount sales. On other fronts, prices were lower across the brewery and oil & gas sectors.
In the consumer basket, average prices increased by 2.2% MoM largely due to reversal of price discounts following weeks of discount sales. Elsewhere, we noted increases in price of Close Up (+8.1%) and Dangote Pasta (+4.6%) which was not linked to any reversal of price discounts. Current price of Close Up now match the price of its closest competitor, Oral B. On the other hand, the increase in price of Dangote pasta now places it at a premium to Honeywell and Golden penny pasta.
Prices in the brewery basket moderated slightly by 0.10% MoM as competition remained stiff in the sector. Price moderation was more evident in Goldberg (-1.2% MoM) and Satzenbrau (-0.6% MoM).
Average price in the commodities basket remained elevated over January with prices rising by 0.57% MoM. Importantly, Palm Oil prices extended its rally into the month following festive period induced price hike. Nonetheless, prices are almost 10% lower compared to same period in the prior year. Similarly, vegetable oil prices were during the period. In a different trend, average price of rice moderated over January. Despite incessant floods, bumpy harvest continued to support crop production and supply during the period.
Prices in the oil & gas sector witnessed moderated over January with average prices down by 0.78% MoM largely on the back of lower Cooking Gas price (-2.3% MoM). We believe this is largely due to increased domestic and foreign supply.
Prices in the cement sector increased by 1.0% MoM following a decline in the previous month. On other fronts, activities in the cement sector picked up slightly relative to December gauged by demand for cements over the period.
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