Macroeconomic Forecast Nigeria

August 2008 | Macroeconomic Forecasts

Headline inflation in July surged to 13.9% y-o-y, the highest level since November 2005, from 12.1% in June. Inflation's gains were again driven by rises in food inflation, which hit 20.9% and makes up 64% of the CPI basket. We have been forecasting a rise in inflation over H208, and the Central Bank of Nigeria 's decision to hold rates at 10.25% in August means even higher inflation rates may be on the cards over the next few months. Moderate relief to food prices may come in the form of an upcoming harvest, but rising core inflation should leave headline inflation above 10% for the rest of the year.

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