Citing the ongoing closure of the country’s land borders, seasonal factors such as New Year and Christmas festivities, as well as the impact of heavy rainfall on harvest, Financial Derivatives Company (FDC) has predicted that Nigeria’s inflation will continue its upward trend in October.
In a report obtained by Naija247news at the weekend, the firm also forecast that the payment of new minimum wage and its arrears would contribute to pushing Nigeria’s inflation rate up marginally from 11. 24 per cent in September to 11.60 per cent in October 2019.
The firm said: “Based on our survey, headline inflation is expected to continue its upward trajectory in October. The index is estimated to soar by 0.36 per cent to 11.60 per cent. The factors driving inflation remain supply shocks with underlying cost push pressures. The impact of the border closure was further exacerbated by unusual heavy rainfall in October, which had a negative impact on harvest.
“Typically, consumer prices tend to increase towards the end of the year due to rising demand for goods and services for the Christmas festivities. This, at a time when the border closure has created some shortages, will further push up prices.
“The monetary policy committee will meet this month. We expect the rising inflation trend to be a major consideration. More importantly, the committee will be interested in inflation expectations as it strives to achieve a single digit inflation rate.”