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IMF predicts 16.1% for inflation in Nigeria

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THE International Monetary Fund (IMF) has projected that Nigeria’s Consumer Price Index will soar past 16.1 per cent in 2022.

  Giving the projection in its Regional Economic Outlook for Sub-Saharan Africa published on its website, IMF blamed growing food costs, adding that it will further pressure citizens of Nigeria and other Sub-Saharan African countries.

  “In sub-Saharan Africa, food prices are also the most important channel of transmission, although in slightly different ways. Wheat is a less important part of the diet, but food, in general, is a larger share of consumption. Higher food prices will hurt consumers’ purchasing power, particularly among low-income households, and weigh on domestic demand. Social and political turmoil, most notably in West Africa, also weighs on the outlook,” the report reads in part.

  But IMF’s projection parallel predictions contained in a recent World Bank assessment which found that inflation will force around 23 million Nigerians into a food crisis by 2021, particularly in conflict-affected areas.

  “Rising food prices are the underlying factor behind the surge of headline inflation in Nigeria. Food prices have increased due to import restrictions and a nonflexible exchange rate management.                          The current regime is keeping the official exchange rate of the naira artificially strong while the naira has weakened significantly on the parallel market. Additionally, the central bank has restricted importers’ access to foreign currency for 45 products and has reduced the supply to other importers,” the report had read in part.

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