Fidelity bank banner UBA banner
Experts say CBN’s 2018 single-digit inflation rate target not feasible

By News Express on 17/04/2018

Share on facebook Yahoo mail icon Gmail icon Share on Google+

Views: 686


 

Two financial experts on Monday said that the 2018 single-digit inflation target of the Central Bank of Nigeria (CBN) would not be feasible, due to the downside risks occasioned by electioneering spending.

 The experts expressed the viewpoint in separate interviews with the News Agency of Nigeria (NAN) in Lagos while reacting to the March inflation figure released by the National Bureau of Statistics (NBS).

Dr Uche Uwaleke, Head of Banking and Finance Department, Nasarawa State University Keffi, said that the apex bank’s single-digit inflation projection appeared impossible in a pre-election year.

Uwaleke said that the target would not be achievable following downside risks such as election spending and implementation of minimum wage.

He said that inflationary pressure would likely resume in the third quarter on the back of waning base effect and electioneering spending.

According to him, another downside risk down the road is the implementation of the minimum wage by the government, expected to kickoff in the third quarter of the year.

Uwaleke said that the drop in the March inflation rate to 13.34 per cent, from 14.33 per cent in February, was in line with expectations.

He said that the current disinflation trajectory was expected to continue until the end of the second quarter, due to stable exchange rate and base effect.

NAN reports that base effect relates to inflation in the corresponding period of the previous year; if the inflation rate was too low in the corresponding period of the previous year, even a smaller rise in the Price Index will arithmetically give a high rate of inflation now.

On the other hand, if the price index had risen at a high rate in the corresponding period of the previous year, and recorded high inflation rate, a similar absolute increase in the Price index now will show a lower inflation rate now.

“The year on year reduction in inflation rate since February 2017 has been partly due to the base effect. That is, the fact that CPI has been computed based on previously high inflation figures,” Uwaleke said.

Prof. Sheriffdeen Tella, Professor of Economics, Olabisi Onabanjo University Ago-Iwoye, Ogun, said that the inflation pressure would heighten in the next few months with election campaigns.

Tella said that the apex bank should be at alert and formulate policies that would reduce inflationary pressure during the period.

He, however, attributed the slowdown in the inflation rate to stability in the exchange rate and low demand in the economy, due to the credit crunch by the CBN.

NAN reports that Mr Godwin Emefiele, CBN Governor, in October 2017, said that inflation rates were projected to drop and record high single-digit rates mid-2018.

Emefiele stated this while speaking with journalists at an investment conference at the London Stock Exchange.

“We are very optimistic that food prices will come down; and as they come down, it will help to complement the reduction in core inflation.

“We are hoping that by the middle of next year, we should begin to approach the high single-digits,” he said. (Nigerian Tribune)

Source News Express

Posted 17/04/2018 12:36:35 AM

 

Share on facebook Yahoo mail icon Gmail icon Share on Google+


 

CLASSIFIED ADS

 

You may also like...
AfDB sets aside $200m to aid farmers 600,000...

2019 elections: INEC adjusts budget to N143bn

Shiites blame Buhari for non-release of El-Zakzaky

Bayelsa uncovers N322m monthly fraud in local govt....

Asiwaju Tinubu, Restructuring and The King’s College Speech,...

Stock Exchange suspends trading on Seven-Up shares

Governor vows to expose those behind ghost workers...

El-Rufai irresponsible, rascally —Middle-Belt Forum •Advises ex-minister to...

Herdsmen Attacks: APC Governors oppose grazing reserves, opt...

FG arraigns former Benue governor, Suswam, over illegal...

Fuel price increase inevitable: FG

Death toll in Rivers tanker fire hits 150...

 

Latest News Anambra monarch, wife die in quick succession Atiku releases ‘policy document’, promises to create three million jobs each year 4 INEC workers, NYSC member, 3-year-old die in Kogi accident Evans: Police hid me from Falana in a toilet University professor, employee kidnapped 2019 campaigns: Ezekwesili makes history, declares self the best 2019 Presidency: Jukuns endorse Atiku FG commends Zinox commitment to local content adoption Tambuwal now PDP Sokoto governorship candidate N800bn subsidy debt: Oil marketers send SOS message to FG I have forgiven those who plotted to impeach me — Ortom FEPSAN commends FG’s ban of NPF fertilizers

 

Most Read NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (422,042 views) Nigerian female sex addict opens up, says ‘I like it with both men and women’ (390,440 views) Shameless Genevieve Nnaji exposes breasts in public (323,492 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (271,946 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (244,513 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (227,649 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (209,349 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (190,907 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (176,181 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (168,744 views) Lagos plane crash: Journalist releases victims’ names (165,315 views) Gunmen kill ASP, 2 other police officers in vain bid to kidnap Rivers PDP chieftain (152,169 views)

 

Zenith Zero Balance First Bank chat banking

 

Categories Advertorials (3) African Press Organisation (81) Art & Literature (74) Business & Economy (3,800) Business Verdict (54) Columnists (964) Complaints & Requests (94) Enterprise & Opportunities (208) Entertainment (568) Features (670) Global Business Monitor (310) International (2,695) Interview (167) Live Commentary (28) Love Matters (146) Maggie's Blog (38) News (40,644) Opinion (1,144) Pidgin (13) Politics (7,787) Religion (901) Sports (1,780) Stock Watch (35) AMA & Al Jazeera Global Update

 

 

 

 

APO Group Partner

 

 

CLASSIFIED ADS

GOCOP Accredited Member

GOCOP Accredited member

 

 

Africa Media Agency and Al Jazeera