Nigeria’s Inflation Rate’ll Rise to 11.4%, Says CBN

Nigeria’s inflation rate is expected to rise to about 11.4 per cent for the rest of this year till mid-2019, the Central Bank of Nigeria has said.

The CBN Governor, Godwin Emefiel*e, disclosed this while speaking on Nigeria’s outlook and policy thrust for 2019.

He said, “Inflation expectations are rising on the backdrop of anticipated politically related liquidity injections. For the rest of 2018 and towards mid-2019, Nigeria’s rate of inflation is projected to rise slightly to about 11.4 per cent and then moderate thereafter.”

The consumer price index, which measures inflation decreased to 11.26 per cent (year-on-year) in October2018, according to latest report by the National Bureau of Statistics on its ‘CPI and inflation report October 2018’.

The statistics revealed that this was a 0.02 per cent points lower than the rate recorded in September 2018 (11.28 per cent).

While speaking on the exchange rate, he said that although the CBN had so far managed to maintain exchange rate stability, the current capital flow reversals from emerging markets were expected to continue to exert considerable pressure on market rates.

This pressure, he added, could be amplified by the forthcoming elections, especially as the political marketplace heats up.

He said notwithstanding those pressures, the CBN was determined to maintain its stable exchange rate policy stance over the next few months, given the relatively high level of reserves.

“Gross stability is projected in the foreign exchange market given increased oil-related inflows and contained import bill. I would like to make it categorically clear that sustaining a stable exchange rate is of overriding importance to us even as we continue to put measures in place to shore up reserves,” he said.

While speaking on the balance of payments, he said it was expected to remain positive in the short term, and that oil prices continue to recover, adding that it was expected that the current account balance would strengthen even further.

“This will be supported by improved non-oil performance as diversification efforts begin to yield results to reduce undue imports,” he added.

Emefiele also said that the apex bank would explore the possibility of leveraging technology to enhance credit to critical sectors of the economy, especially agriculture and manufacturing.