Looming Electricity, Petrol Price Hikes will Affect Inflation—FSDH

March 20, 2017
Inflation Rate

Looming Electricity, Petrol Price Hikes will Affect Inflation—FSDH

By Modupe Gbadeyanka

Latest report by FSDH Research has warned that the imminent increase in the electricity tariff and the pump price of Premium Motor Spirit (PMS) otherwise known as petrol “will limit the rate of drop in the inflation rate in Nigeria in the short term.

In the report released last Friday and titled ‘MPC Meeting: Considerations and Policy Options’, the FSDH Research however said an expected increase in food production in the country on account of favourable policies will dampen food prices, which may lower the inflation rate.

The report comes as the Central Bank of Nigeria (CBN) holds its Monetary Policy Committee (MPC) meeting today, Monday, March 20, 2017, in Abuja.

“We expect the MPC to maintain a ‘wait and see’ approach and hold rates at their current levels,” the report said.

The inflation rate dropped for the first time in 15 months in February 2017 to 17.78 percent, from 18.72 percent in January 2017.

The drop in the inflation rate was because of base effect.

Modupe Gbadeyanka

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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