Headline inflation, a measure that tracks consumer prices in an economy, increased in Nigeria in June 2024 as people paid more for food, transportation, and energy. Data from the Bureau of Statistics showed inflation accelerated to 34.19% in June 2024 from 33.95% in May.
It will worry policymakers counting on inflation to stall as talks of a nationwide protest gain ground. On Friday, the government suspended taxes and import duties on food items like maize and wheat for 150 days, one year after acknowledging a food emergency. It will likely lower food costs for the first time in over two years and ease political pressure on the CBN to lower rates.
Despite this, a month-on-month increase in inflation between May and June will put talks of an interest rate increase on the table in the short term. Nigerian billionaire Aliko Dangote told reporters on July 3 that no growth could happen while interest rates remained at 30%. It’s a position held by many government insiders who believe CBN governor Cardoso—who has raised interest rates twice this year—should backpedal. So far, Cardoso has remained unmoved.
The discussion will be back on the table at next week’s Monetary Policy Meeting (MPC).
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