Tayo Busayo, Abuja
DAILY COURIER - Nigeria's inflation rate has risen for the fourth consecutive month, reaching 34.8% in December 2024, up from 34.6% in November, according to the National Bureau of Statistics (NBS). This marks the highest inflation rate in nearly three decades.
The NBS attributes this uptick to increased demand during the festive season, with significant contributions from the food and non-alcoholic beverages sectors. Food inflation slightly eased to 39.84% in December from 39.93% in November, reflecting price increases in staples such as yam, sweet potatoes, beer, corn, rice, and fish.
In response to rising inflation, the Central Bank of Nigeria raised interest rates six times last year in an effort to control price growth. Despite these measures, the government anticipates a reduction in inflation to 15% this year, supported by decreased imports of petroleum products.
Dr. Paul Alaje, Chief Economist and Partner at SPM Professionals, expressed skepticism about the government's inflation target, stating, "Reducing inflation to 15% within a year is highly ambitious given the current economic realities. Structural issues such as supply chain disruptions and currency instability need to be addressed to achieve such a target."
Financial analyst Dr. Muda Yusuf noted that the persistent rise in inflation is eroding the purchasing power of Nigerians, leading to a decline in living standards. He emphasized the need for policy coherence and effective implementation to stabilize the economy.
Festive Season Demand: The December inflation rise is partly attributed to increased consumer spending during the festive period.
Food Prices: Staple foods such as yam, sweet potatoes, and rice have seen significant price hikes, contributing to high food inflation.
Economic Reforms: Government policies, including naira devaluation and subsidy removal, have had mixed effects on inflation trends.
Central Bank Measures: Despite multiple interest rate hikes by the Central Bank, inflation continues to rise, posing challenges for monetary policy.
Government Targets: The administration aims to reduce inflation to 15% in 2025, a goal viewed as ambitious by economic experts.
The persistent inflationary pressures highlight the complex economic challenges facing Nigeria, with significant implications for both policymakers and the general populace.
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