Tony Chukwunyem 
Citing factors such as base effects, decline in money supply growth, exchange rate stability and steadiness in logistics cost, analysts at Financial Derivatives Company (FDC) Limited have predicted that Nigeria’s inflation is likely to ease further this month.
The analysts, who made the prediction in a report released a few weeks after the National Bureau of Statistics (NBS) published rebased Consumer Price Index (CPI) data, which showwd that headline inflation fell sharply to 24.48 per cent in January 2025, from December 2024’s 34.80 per cent , said that they expect inflation to decline further this month and next, irrespective of the inflation methodology (old or new) that experts apply in calculating the CPI.
Specifically, the analysts stated: “Inflation data is likely to show a decline of 1.24per cent to 32.11per cent, using the old methodology.” Other predictions made by the analysts include:
“Broad money supply growth will taper again towards 15per cent; the average primary and secondary market T-bill rates will hold steady at 17-19per cent p.a.; the average opening position of deposit money banks will increase to N700 – N800 bn in April.”
They also forecast that although the Organisation of Petroleum Exporting Countries (OPEC) will maintain its slight increase in output, Nigeria’s oil production will average 1.5mbpd and that Brent will trade at $65 – $70 pb.
The situation, the analysts said, will put the country’s external sector under pressure, adding that: “The naira will depreciate marginally from its current trading range towards N1,570 – N1,600 in May/June.”
They further stated that, reflecting the drop in global oil prices,” the pump price of petrol will fall marginally to N840/ litre.
According to the analysts, the next meeting of the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC), which holds in May, is likely to cut the policy rate by 25 basis points.
At its last meeting in February this year, the MPC left the benchmark interest rate- the Monetary Policy Rate (MPR) unchanged at 27.50 per cent , after 875 basis points of rate hikes in 2024 as the apex bank stepped up its fight against inflation.
CBN Governor, Olayemi Cardoso told a press conference at the end of the meeting that the MPC was satisfied by recent macro-economic developments and they were expected to help price dynamics.
“Inflation is trending down, and it’s looking positive,” Cardososaid, adding that the aim was to bring inflation down to single digits.
