Another month, another dip in the inflation rate. Nigeria records a 13th-consecutive decrease in inflation in the month of February, with the country edging towards the desired single-digit target.
In the latest Consumer Price Index (CPI) report by the National Bureau of Statistics (NBS), consumer prices growth eased up to 14.3 percent from 15.1 recorded in the month of January. It is the lowest inflation rate since April 2016. The inflation rate has been decreasing since, reaching more than a 12 year high of 18.72 percent in January of 2017. The Food Index also decreased by 1.33 percent points to 17.59 percent from the recorded rate of 18.92 percent from the previous month.
The CPI which measures the average change over time in prices of goods and services consumed by people day-to-day is calculated against the base year of 2009. It accounts for 750 goods and services in the country.
The Central Bank Governor, Mr Godwin Emefiele, had said last year during the apex bank’s economic forecast for 2018 that it was expecting a “very low double-digit or high single-digit levels” this year barring any external shocks. The CBN had already reached its forecast of $40 billion in external reserves hitting a high of $43.2 billion last week.
The price of food and fuel had skyrocketed in 2016 due to the fall in international oil prices as well as a weaker currency that raised prices of imported goods in the country. But over the past few months through innovative foreign exchange management, restriction on certain food imports like rice and Nigeria’s improved oil production and supply the CBN has been able to stabilize the economy.
CBN’s efforts to further stimulate the economy can be complemented when the Senate screens President Muhammadu Buhari’s nominees for the Monetary Policy Committee (MPC). The Monetary Policy Committee couldn’t meet in January as there were insufficient members to form a quorum and are scheduled to meet again on March 19-20.
The lawmakers had refused to confirm new members for the 12-man committee amid a political stalemate that involves disagreement over Ibrahim Magu as the head of the Economic and Financial Crime Commission (EFCC) with President Muhammadu Buhari.
However, the Senate on Tuesday resolved to follow through with the process of confirming the nominees. This came after a motion moved by one of the Senators stating the importance of confirming the committee to improving the economy.
In the latest IMF recommendations, the global financial watchdog had also urged for the confirmation of the appointments of the members of the monetary policy committee. The committee is the highest policy-making committee of the CBN and responsible for formulating and implementing the Monetary and Exchange rate policies.
The committee had kept the monetary policy rate at 14 percent since July 2016 due to rising inflation but could consider easing the rate to attract new investments to the country and further accelerate economic development.