By CGTN Africa
Nigerian inflation remained steady in January, leaving room for the central bank to keep interest rates on hold, Bloomberg reported.
According to the report, consumer prices rose 15.6 percent in January from a year earlier, compared with 15.63 percent in the previous month, Statistician-General Simon Harry told reporters Tuesday in Abuja, the capital. The median estimate of eight economists in a Bloomberg survey was 15.5 percent.
While inflation has now exceeded the top of the central bank’s target band of 6% to 9% for almost seven years, it’s unlikely to persuade the monetary policy committee to increase the key interest rate when it meets next month. Since last year, Governor Godwin Emefiele has reiterated that the central bank will only make policy adjustments once the economy’s recovery is on a sustainable path.
The top African crude producer’s rebound from its worst contraction in almost three decades in 2020 is being hindered by persistent production troubles in its oil industry, making it difficult to fill its quotas under a pact with the OPEC+ alliance. While oil contributes less than 8% to Nigeria’s gross domestic product, it accounts for nearly all foreign-exchange earnings and half of government revenue.
A survey of 12 economists conducted by Bloomberg in November projected the pace of economic growth decelerated to 1.4 percent in the final quarter of last year, from 4% in the prior three-month period.
The International Monetary Fund said earlier this month that “with the recovery yet to be broad-based, the projected decline in inflation, limited fiscal policy space, and contained financial sector risks, supportive monetary policy is appropriate unless exchange rate pressures intensify, or inflationary pressures resurface.”
Food price growth slowed to 17.1 percent in January, compared with 17.4 percent in the prior month, and core inflation was little changed at 13.87 percent from 13.9 percent in December. Prices climbed 1.5 percent in the month.
Long fuel queues, which have appeared in the West African nation since February, has led to a sharp rise in transport fares that is likely to put upward pressure on prices in March. Africa’s largest economy, which imports all of its refined fuel, this month withdrew some supplies of gasoline from the market because they were unsuitable for domestic consumption, causing shortages.
