From Uche Usim
Nigeria’s headline month-on-month inflation rate slowed for the third consecutive month in May 2024, signaling that the Central Bank of Nigeria’s (CBN) monetary policy tightening measures are effectively curbing inflation. According to the National Bureau of Statistics (NBS), headline inflation decelerated to 2.14 percent in May from 2.29 percent in April and 3.02 percent in March. This marks a significant drop from the 3.12 percent recorded in February.
Food inflation, a key driver of overall inflation, also declined for the third straight month. It fell to 2.28 percent in May from 2.50 percent in April, and significantly from 3.79 percent in February. This reduction in food inflation reflects a slowdown in price increases for essential goods, providing some relief to consumers.
The consistent decline in monthly inflation rates underscores the CBN’s Monetary Policy Committee (MPC) confidence in their strategy. The combination of tighter monetary policies and coordinated fiscal measures from the Federal Government aims to address the high cost of living that has plagued Nigerians, particularly following the Covid-19 pandemic. While year-on-year inflation remains elevated, the monthly figures are crucial for gauging the immediate impact of the CBN’s policy interventions since interest rate hikes began in February this year.
“Slowly but surely, the inflation tide is turning,” said Muhammad Sani Abdullahi, Deputy Governor of the Economic Policy Directorate at the CBN. “Although the year-on-year figures are not yet consistent across all measures, such as nationwide data, we are diligently working with coordinated policies to ensure the worst of the inflationary cycle is behind us soon.”
Year-on-year inflation slowed in May for 13 Nigerian states, including Abuja, Akwa Ibom, Borno, Cross River, Delta, Katsina, Ondo, Oyo, and Rivers. The nationwide decline in the month-on-month inflation rate is evident in the reduced pace of price increases for some food staples.
CBN Governor Olayemi Cardoso has prioritized tackling inflation as essential for achieving sustainable economic growth and improving living standards. His commitment to this mission is reflected in the central bank’s ongoing efforts to control inflation through rigorous monetary policy measures.
The continued success in reducing inflation rates is critical for stabilizing Nigeria’s economy and enhancing the welfare of its citizens. The CBN’s proactive stance demonstrates a firm resolve to navigate the challenges posed by inflation and set the country on a path to long-term economic stability.
