Nigerian Businesses and Households Expect Inflation Rate to Rise in Coming Months
Nigeria’s Central Bank has released its July Inflation Expectations Survey Report, revealing that businesses and households alike expect the inflation rate to rise in the next one to six months. According to the report, respondents anticipate inflation to increase with indices of 37.4 for the next month, -26.3 for the next two months, and -15.8 for the next six months.
While the report suggests that the inflation rate will rise, it also indicates that respondents expect it to gradually reduce over the next six months. Interestingly, businesses anticipate a drop in the inflation rate compared to households, with indices of -33.4 and -11.0 points for the next month and next six months respectively.
The expected inflation rate hike is largely attributed to changes in energy prices, exchange rates, and transportation costs. This development comes weeks after Nigeria’s inflation rate declined to 33.40 percent in July, down from 34.19 percent in June. The Central Bank has been tightening monetary policy measures, including the interest rate, which currently stands at 26.75 percent, to combat inflation.
The report highlights the mixed expectations of Nigerian businesses and households regarding the inflation rate. While both groups anticipate an increase in the coming months, they differ in their outlook for the next six months. As the country continues to navigate economic challenges, it remains to be seen how these expectations will impact the nation’s inflation rate.
