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Food Prices in Nigeria Expected to Drop by September – Economist Rewane |
Bismarck Rewane, the Chief Executive Officer of Financial Derivatives, has projected that food prices in Nigeria will decrease by September 2024.
The well-known economist shared this insight during an interview with Channels Television on Tuesday.
Discussing the recent Central Bank of Nigeria’s interest rate hike to 26.75 percent, Rewane mentioned that inflation is anticipated to moderate starting in September.
He forecasted a slight reduction in Nigeria’s inflation rate from 34.19 percent to a range between 32 percent and 28 percent by the end of the year.
Rewane attributed this expected change to several factors, including the commencement of operations at the Dangote Refinery in August, the 150-day zero import duty on food program, and the new N70,000 minimum wage.
He also predicted that the Naira would appreciate against the dollar in the foreign exchange market in the coming months.
“This is the inflation spiral. The inflation was increasing sharply, started stagnation now and it is expected to start falling. When I said falling it is not significant. From 34.19 to about 32 percent towards the end of the year to about 28 percent.
“One of the major stocking factors is logistic cost. It is a good thing that Alhaji Aliko Dangote has come to the rescue. Another thing, now it is a law, N70,000 is the new Minimum wage.
“What does all of this mean to the ordinary man?
“What we are seeing is that prices of food commodities will drop or are expected to drop if nobody corners it. Rice for example, the current price is N82,000 and will come down to N70,000 by September, Wheat from N59,000 to N50,000, and Beans from N150,000 to N110,000.
“Food import duty waiver will tamper inflation. Dangote Refinery Fuel product will come on August 15th, it will guarantee supply not price.
“The new Minimum wage will impact inflation only marginally. High interest rates will help increase savings. The Naira will recover from N1,700 per dollar to N1500 in September”, he said.
Recall that the CBN on Tuesday hiked inflation by 50 basis points to 26.75 percent amid efforts to tackle rising core inflation and food inflation which stood at 34.19 percent and 40.87 percent in June 2024.
This development comes after President Bola Ahmed Tinubu government announced plans to suspend import duty on foods for 150 days.
