Why 18% returns make you richer in Abia but poorer in Lagos

Inflation rates show significant variation across Nigeria's states, impacting investors differently. For instance, an 18% annual return on an investment may not preserve purchasing power equally in all regions. In Abia, where headline inflation is 14.3%, an 18% return outpaces the inflation rate and effectively grows the investor's money faster than the rate of price increases.

Conversely, in Lagos, with a headline inflation of 23.7%, the same 18% return lags behind the rate of price increase, leaving the investor's purchasing power relatively stagnant despite the nominal return. This example underscores that while national headline inflation serves as a benchmark for investment evaluation, individual investors should consider state-specific inflation rates to ensure their returns truly bolster their purchasing power.