According to its statistics office, Nigeria’s inflation resumed in January and reached 21.82% in annual terms. This increase was mostly caused by greater food inflation. Before falling to 21.34% in December, inflation in the largest economy in Africa had increased for ten consecutive months, leading to a series of interest rate increases by the central bank.
The majority of Nigeria’s inflation basket, which consists of food prices, increased to 24.32% in January from 23.75% in December. As Nigeria prepares for parliamentary and presidential elections this month, high inflation, slow economic growth, and growing insecurity are top concerns for voters.
Due to term constraints, President Muhammadu Buhari will not run again. Policymakers have connected Nigeria’s infrastructure issues and the fact that many consumer goods are imported to inflationary pressures.
Godwin Emefiele, the governor of the Central Bank of Nigeria (CBN), has stated that if inflation stays high, the bank will maintain a hawkish stance on interest rates. Since last May, when the CBN raised its benchmark interest rate by 600 basis points, it has been at 17.5%.