CBN projects 13% inflation reduction by end of year if lock down doesn’t return

Nigeria’s apex bank, the Central Bank of Nigeria (CBN), has projected as much as 13 percent drop in the country’s inflation rate provided that Covid-19 lock downs are not reintroduced

The bank said that there are multiple areas that should excite investors and stakeholders as the economy returns to growth if Nigeria sustains vaccination rates and does not return to a lockdown.

This was disclosed by Dr Hassan Mahmud, Director, Monetary Policy Department of the Central Bank of Nigeria (CBN) at the Mid-year Economic Review and Outlook 2021, organised by the CIBN Centre for Financial Studies, in collaboration with B. Adedipe Associates, on Friday in Lagos.

According to him, “Also, if the CBN forecasts for GDP growth are sustained and there is improved vaccination and the health hazards and lockdowns are not resurfacing, we will see GDP getting close to three per cent by the end of 2021.

“We will also see the inflation number coming down less than 13 per cent by the end of the year and further down to the NBS projection of single-digit by 2022 or the middle of 2022.

“We will start seeing a downward trend in inflation numbers particularly, headline inflation,” he said.

Mahmud said sustained policies would also improve foreign exchange, insecurity and other factors required to return the economy towards positive trajectory by 2022, citing that food inflation would also drop substantially if the supply side of it is addressed