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Inflation: Experts demand policy reset to ease economic woes

By Akinnodi Francis, Ondo

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Economic experts have called for urgent reforms to fiscal and monetary policies to address persistent inflation in Nigeria, as new data shows a marginal rise in December 2024 inflation figures.

Recently the National Bureau of Statistics (NBS)  released the December Consumer Price Index (CPI), indicating a slight increase in headline inflation from 34.60 per cent in November 2024 to 34.80 per cent in December 2024.

Despite this, food inflation eased slightly, declining from 39.93 per cent to 39.84 per cent over the same period.

The NBS attributed the inflationary pressures to increased demand for goods and services during the festive season, though analysts noted the figures were below earlier projections.

Experts who spoke to Weekend Hope highlighted the need for targeted government interventions to ease inflationary pressures and enhance living conditions for Nigerians.

They argued that harmonising fiscal and monetary policies is critical to stabilising the economy.

Professor Timothy Awe, an economist, described inflation as a persistent challenge, despite the modest slowdown in price increases.

He pointed out that while the 2025 outlook suggests potential relief due to improved exchange rate stability, rising foreign reserves, and easing geopolitical tensions, additional measures are necessary.

“The Central Bank of Nigeria (CBN) must reconsider its monetary tightening policies and halt interest rate hikes to reduce the cost of doing business,” Awe said.

He also called on the government to address fiscal risks by reducing budget deficits and slowing the growth of public debt.

Awe expressed concern over revenue targets imposed on Ministries, Departments, and Agencies (MDAs) by the National Assembly, warning that excessive pressure on MDAs to generate revenue could fuel inflation.

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Financial expert, Dr Emmanuel Adenegan, noted that income constraints are straining consumers and causing resistance to rising prices.

“Retailers are experiencing slower demand for goods and services as customers struggle with stagnant incomes,” Adenegan observed.

“This underscores the impact of cost-push inflation rather than strong consumer demand.”

Analyst Zadok Akintoye suggested that inflationary pressures could ease further in early 2025, particularly in food prices. He cited reduced consumer demand and slower increases in the cost of imported food as likely contributors.

While the experts acknowledged signs of moderation, they emphasised that comprehensive policy realignment remains essential to achieving long-term economic stability and reducing the burden on Nigerians.

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