The National Bureau of Statistics (NBS) has reported that Nigeria’s inflation rate reached 21.82 per cent in January 2023, up from 21.34 per cent in December 2022. This marks a new 17-year high for the country’s inflation rate.
The NBS attributed the rise in inflation to disruptions in the supply of food products, increased import costs due to the naira’s depreciation, and a general increase in the cost of production.
The Central Bank of Nigeria (CBN) has recently implemented a currency redesign policy, which it believes will help control inflation, Investors King reports. The policy aims to bring hoarded currency into the banking system and make monetary policy more effective.
The CBN Acting Branch Controller in Ondo State, Mr Giwa Ademola, believes that the policy will provide more accurate data on money supply and monetary aggregates, leading to better design and implementation of monetary policy.
According to the NBS, the prices of bread and cereal, actual and imputed rent, potatoes, yam and tuber, vegetables, and meat have all increased. The rising cost of food products and other essential commodities has led to significant economic challenges for many Nigerians, particularly those on low incomes.
The current inflationary environment poses a significant threat to Nigeria’s economy, with the cost of living increasing and the value of the naira continuing to depreciate. The CBN’s currency redesign policy may provide some relief, but it remains to be seen whether it will be effective in controlling inflation in the long term.
Nigeria’s inflation rate has reached a new high amidst a currency redesign by the CBN. While the redesign policy aims to help control inflation, it remains to be seen whether it will be effective. With the rising cost of essential commodities, Nigeria’s economy is facing significant challenges, and it will require significant effort to address the issue of inflation and improve the economic well-being of its citizens.