By Akinsuroju Olubunmi
Economic optimism: Nigeria’s Inflation forecast shows improvement
Nigeria’s inflation rate is anticipated to stabilize at 14 per cent by 2029, marking a potential turnaround from the current upward trend, as per the latest data from the International Monetary Fund.
This prediction comes as a welcome relief amidst concerns about the escalating inflation rate, which currently stands at 33.69 per cent as of April 2024, according to the National Bureau of Statistics, a deviation from the IMF’s earlier prediction of 24.6 per cent.
The IMF data indicates a gradual decline in the inflation rate from 23 per cent in 2025 to 16 per cent in 2026, 15.4 per cent in 2027, and 14 per cent in both 2028 and 2029.
This projected stabilization is seen as a positive development for the Nigerian economy, which has been grappling with rising inflation and interest rates, posing significant threats to economic growth and stability.
Recent times have seen Nigeria’s economy facing challenges, with increasing inflation and interest rates presenting significant hurdles.
The Central Bank of Nigeria has implemented various measures to tackle these challenges, including the increase in interest rates at the 295th MPC meeting in May 2024.
However, economists have expressed concerns over the persistent increase in inflation and interest rates, urging the government to address the underlying drivers of inflation, primarily food and transportation costs.
Chief Economist, SPM Professionals, Paul Alaje, expressed his reservations about the increase in the Monetary Policy Rate. He emphasized that Nigeria is experiencing a slowdown in economic growth and is becoming poorer.
“We need to explore other tools beyond monetary policies to provide solutions to our economy. Despite the efforts of monetary authorities, the exchange rate is back at 1,500 heading towards 1,600,” he said.
On the other hand, economist Jonathan Thomas viewed the IMF prediction of a stabilized inflation rate in 2029 as a positive indicator for the Nigerian economy. However, he stressed the need for the government and monetary authorities to remain vigilant and implement policies that address the root causes of inflation.
The current surge in inflation and interest rates has significant implications for businesses, households, and the overall economy.
By addressing the drivers of inflation and maintaining a stable economic environment, Nigeria can foster sustainable economic growth and development, possibly aligning with the IMF’s prediction.
Inflation,
Nigeria
Economic optimism: Nigeria’s Inflation forecast shows Improvement