Economist Predicts Gradual Decline in Nigeria’s Inflation Starting July

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Bismarck Rewane, CEO of Financial Derivatives Company, predicts that Nigeria’s headline inflation will start to cool from July, albeit slowly. Appearing on Channels Television, the economist highlighted that the month-on-month decrease in consumer prices suggests a slowdown in price increases.

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“The inflation numbers released on Saturday indicate that the rate of price level increases has started to slow. Therefore, we project that inflation will begin to decline from July,” Rewane stated. He added, “We believe that, depending on how the minimum wage is managed, we will see a moderation in inflation from July into August—not drastically, but what we call disinflation will start to occur. So there is a flicker of light at the end of the long tunnel.”

Rewane further noted that as inflation cools, Nigeria’s economy is expected to improve, easing the prevailing hardships. “After difficulty and chaos comes light at the end of the tunnel. We are cautiously optimistic that things will start improving slowly,” he said.

Nigeria is currently experiencing near three-decade high inflation, reaching 33.95% in May, marking the 17th consecutive rise from 33.69% in April 2024. Despite the month-on-month figures showing a two-month decline, the prices of food and essential commodities remain high. According to the National Bureau of Statistics, food inflation increased to 40.66% in May from 40.53% in April, exacerbating hunger as prices more than doubled. This surge was driven by higher prices for millet flour, garri, beans, wheat flour (prepacked), semovita, and other food items.

Addressing the departure of some multinationals from Nigeria, Rewane noted that while some companies are leaving, others capable of enduring the challenging business environment are entering the market. “What is more important in economics is what the future holds rather than what the past has shown,” he emphasized.

In less than a year, over five multinationals have exited Nigeria, a blow to the country’s illiquid economy that desperately needs foreign direct investment and dollar liquidity. Many of these companies cited the unstable exchange rate and harsh economic conditions as reasons for their departure. Rewane concluded, “Some are exiting, some are downgrading, while others with the tolerance and capacity to manage difficult situations are coming in.”

Emman Tochi
Emman Tochihttps://naija247news.com
Emma Tochi is Naija247news Media Northern Bureau Chief, he's based in FCT Abuja. He overseas the northern operations of this business media

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