'Nigeria’s inflation rate will drop to 23% by 2025' - IMF reveals

The International Monetary Fund (IMF) while releasing its Global Economic Outlook at the IMF/World Bank Spring Meetings in Washington D.C., on Tuesday, disclosed projections for Nigeria’s economy, showing a major shift in inflation rates.

Division Chief of the IMF Research Department, Daniel Leigh, spoke about the impact of Nigeria’s economic reforms, which included exchange rate adjustments.

According to him, these reforms have led to a surge in inflation rate to 33.2 percent in March.

Data released by the National Bureau of Statistics (NBS) indicated that the country's inflation rate increased to 33.2 percent. Food inflation rate also increased to over 40 per cent in the first quarter of 2024.

Leigh said: “We see inflation declining to 23 per cent next year and then 18 percent in 2026.”

Leigh also highlighted on the country's economic growth, which is expected to rise from 2.9 percent last year to 3.3 percent this year, attributing this expansion to the recovery in the oil sector, improved security, and advancements in agriculture due to better weather conditions and the introduction of dry season farming.

“Inflation has increased, reflecting the reforms, the exchange rate, and its pass-through into other goods from imports to other goods,” Leigh said.

An official of the IMF Research Department, Pierre Olivier Gourinchas also spoke about the global economic landscape, stating that oil prices have risen partly due to geopolitical tensions, and services inflation remains high in many countries.

“Trade linkages are changing, and while some economies could benefit from the reconfiguration of global supply chains, the overall impact may be a loss of efficiency, reducing global economic resilience,” Gourinchas said.

BEB