How the rise in inflation may affect Nigerians


The apex regulatory body of banks CBN, recently expressed fears that inflation rate may rise marginally into the second quarter fueling fears in some quarters that the economy may take the hit.  

To the discerning mind, the buzzword ‘inflation’ has both its merits and demerits. But when the top echelons of the economic managers, especially the CBN governor, Godwin

Emefiele brood over this subject then it becomes something that should be taken seriously.

Nigeria’s inflation rate jumped to 11.44% in December 2018 from 11.28% recorded in November 2018, the National Bureau of Statistics (NBS) has said.

The Bureau, in its “CPI and Inflation Report’’ for December 2018 released in Abuja on Wednesday, January 16, 2018, stated that the figure was 0.16% points higher than the rate recorded in November same year.

The rise is the highest inflation figure since June 2018.

According to the report, increases were recorded in all Classification of Individual Consumption by Purpose divisions that yielded the Headline index.

NBS says the headline index increased by 0.74% in the period under review by 0.06% points from the rate recorded in Nov. 2018 (0.80%) on a month-on-month basis.

How the rise in inflation may affect Nigerians

Here’s how it may affect Nigerians:

• The Central bank of Nigeria may increase interest rates to moderate the inflation rate in the short run.

• Fixed income earners find it difficult to get more items – reduce purchasing power. Take home pay may not get home.

• Consumers with a loan facility may find it difficult to pay and hence, may lead to bad debt for commercial banks.

• It will affect a country’s exchange rate – Nigeria naira may depreciate further against other currencies – exchanging at a high rate per a dollar.

• It poses great uncertainty for the Nigerian market.

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