The Central Bank of Nigeria (CBN) has said Nigerians expect rising inflation rate to hurt economic growth, according to the apex bank’s latest Inflation Attitudes Survey (IAS) report for the third quarter of 2020.
Households surveyed by the Statistics Department, CBN, believe the economy would end up weaker if consumer prices continue to rise faster than they were in September when the survey was conducted.
In September, Nigeria’s inflation rate was 13.71 percent but has since risen to 14.23 percent in October and expected to remain above that level given the current macroeconomic fundamentals and the central bank resolve to stimulate economic productivity by continuously pumping cheap money into the real sector.
“Respondents were asked what would become of the Nigerian economy if prices started to rise faster than they do now. The survey result showed that 62.1 per cent of the respondents believed that the economy would end up weaker, 9.0 per cent stated that it would be stronger, 12.6 per cent of the respondents believed it would make a little difference, while 16.4 per cent did not know,” CBN stated.
The apex bank stated that Nigerians prefer cheaper borrowing costs to a rising inflation as they agreed that rising prices amid weak economic growth and earnings will hurt productivity and subsequently weigh on Africa’s largest economy in the remaining quarters of the year.