LAGOS, Nigeria(VOICE OF NAIJA)- If current reforms are sustained, inflation in Nigeria could fall to about 14 per cent by late 2026, the Group Chief Economist and MD of Afreximbank, Yemi Kale, has said.
Delivering a keynote at The Platform Nigeria, Kale noted that inflation already eased to 20.12 per cent in August, down from 21.88 per cent in July. Yet, he warned, many households will still grapple with economic challenges in the short term.
He traced Nigeria’s inflation woes to years of oscillating monetary policy—tightening to curb price pressures, then loosening to boost growth—often undercut by quasi-fiscal activities that compromised effectiveness.
Recently, the Central Bank of Nigeria (CBN) has prioritized price stability, raising its Monetary Policy Rate (MPR) to 27.5 per cent, and using open market operations to soak up excess liquidity.
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These measures, Kale said, have helped drag inflation down from its 25–30 per cent range in 2023–24 into the low 20s. While food inflation remains stubborn, its pace of increase has cooled.
Kale emphasized the importance of each percentage point of inflation reduction — it safeguards people’s real incomes and savings and creates a more stable environment for investment.
He criticised past reforms for lacking adequate social protection to shield vulnerable groups from immediate impacts.
As examples, he pointed to Egypt and Ghana, where reforms were paired with cash-transfer programmes and school feeding policies to cushion the effect.
Kale argued that reforms can’t just be political gestures; they require sound planning, clear communication, credible execution, and integrated social safety nets to maintain public trust.
He concluded by stressing that, if reforms are maintained and bolstered with social measures, Nigeria stands a real chance of achieving the 14 per cent inflation threshold by 2026.
