New Telegraph Admin 
The International Monetary Fund (IMF) has said that monetary tightening by the Central Bank of Nigeria (CBN) is likely to lead to the country’s inflation rate dropping to 23 per cent and 15.5 per cent in 2024 and 2025 respectively. The Division Chief, Research Department at the IMF, Daniel Leigh, disclosed this at the press briefing for the Fund’s January 2024 World Economic Outlook (WEO) update on Tuesday.
Although he stated that the depreciation of the naira, occasioned by the forex reforms introduced by the CBN in June, contributed to pushing inflation to 28.92 per cent in December, Leigh pointed out that financing of the Federal Government’s deficit also helped to drive up prices. He said: “So yes, there were reforms and the currency depreciated, and some of this weakness in the naira has contributed to the increase in inflation.
Now there are also structural factors behind that high inflation, including, you know, on the fiscal side, financing of the deficit. But this is clearly creating hardship. “The perspective that we have is bringing down inflation is top priority. And Central Bank of Nigeria, has already raised interest rates significantly over the past year to 18.8 percent.
So that is the monetary tightening that is helping in our forecast to bring inflation down from 24.6 percent in 2023 percent, to 23 percent this year, and then closer to single digits into 2025 at 15.5 percent.”
