Central Bank of Nigeria (CBN) has projected a single-digit inflation rate by 2020.
Gatekeepers News reports that CBN on Friday said the nation’s inflation rate is likely to drop to 13 percent by the end of 2021 and single-digit by 2022.
CBN’s Director of Monetary Policy Department, Hassan Mahmud stated at the virtual mid-year economic review and outlook 2021, organised by the Chartered Institute of Bankers of Nigeria’s Centre for Financial Studies, in collaboration with B. Adedipe Associates in Lagos, Southwest Nigeria.
Nigeria’s inflation rate moderated by 0.18 percent to 17.75 percent in the month of June compared to the 17.93 percent recorded in May.
According to Mahmud, despite uncertainties in the domestic and global economy, there are still positive sides to Nigeria’s economic growth.
He noted that if challenges like exchange rates, insecurity, among others were addressed effectively, the country would start experiencing positive projections in 2021 and the beginning of 2022.
“Also, if the CBN forecasts for GDP growth are sustained, and there is improved vaccination, and the health hazards and lockdowns are not resurfacing, we will see GDP getting close to three per cent by the end of 2021,” Mahmud said.
“We will also see the inflation number coming down less than 13 percent by the end of the year and further down to the NBS projection of single-digit by 2022 or the middle of 2022.
“We will start seeing a downward trend in inflation numbers particularly, headline inflation.”
Mahmud stated that food inflation would also fall significantly if the supply side of it and security issues are addressed.
Gatekeepers News reports that he said inflows should also grow substantially over the rest of the year, given that market confidences were already building, particularly in the financial sector.
On his part, Chief consultant of BAA Consult, Biodun Adedipe said if the oil sector was positive in terms of prices and production volume and export volume, it would go a long way in driving growth.
“At BAA, our projections for Nigeria economic growth for 2021 had remained 2.54 per cent since February, and we have maintained it so,” Adedipe noted.
“If the prognosis, the oil sector in Nigeria is positive in terms of price, production volume and export volume, that goes a long way in driving growth and changing some of what we see as headwinds and risks.”