Members of the Monetary Policy Committee of the Central Bank of Nigeria are worried about the hardship that the country’s soaring inflation is inflicting the poor and low-income earners.
The Monetary Policy Members made the concern known in their personal statements at the last MPC meeting held in Lagos.
They lamented that the country’s surging inflation has eroded the income of the average Nigerian and driven more people into poverty.
Over the last seven months, Nigeria’s inflation has been on the rise with the latest increase hitting 19.64 per cent in July from 18.60 per cent recorded in June.
Food inflation has climbed to 22.02 per cent based on the latest report released by the National Bureau of Statistics.
The CBN Governor, Mr. Godwin Emefiele, had set an inflation target of six to nine per cent, but the authorities have failed to influence a lower inflation rate.
In his personal statement, Adeola Festus said that “Inflation is rising at an unacceptable rate. Rising inflation is a threat to investment and output growth. Inflation is lowering the real incomes of Nigerians and driving more people to poverty.
“Inflation is hurting many Nigerians, whose nominal wages have remained stagnant for many years. It is dragging down the values of savings, wages, and pensions for retirees. Price stability is a core function of the MPC, and hence, the high level of domestic inflation is unacceptable.”
The CBN adjusted the benchmark rate from 11.5 per cent to 13 per cent in May 2022, before the MPC members voted for another hike to 14 per cent in July 2022.
The CBN Deputy Governor in charge of Economic Policy, Kinglsey Obiora, in his statement said, “As inflation continues to rise rapidly and fast eroding the real income of households and businesses, the need to bring it under control has become more urgent.
“Inflation is weighing heavily on individual households across the country, especially the most vulnerable low-income families. The high costs of food and other necessities continue to erode the purchasing power of ordinary Nigerians, thereby entrenching food insecurity,
poverty and inequality.”
For Mike Obadan, he stated that the inflation figures were alarming and causing deterioration of the living standards in the country.
Obadan said, “In Nigeria, the most pressing current challenges are sustenance of the fragile growth, escalating inflation and foreign exchange/exchange rate pressures.
“The other major challenge which must now gain priority attention is the escalating inflation in view of its obvious consequences for investment, growth and standard of living. After the significant gains recorded in inflation control in 2021, all the three measures of inflation, year-on-year – headline, food and core– have trended upwards since February 2022.”
Similarly, another MPC member, Dr Mo’ Omamegbe, in his remarks said, “Consumers are being squeezed by inflation and its negative effects. The rising inflation in the country constitutes a major macroeconomic challenge which is exacerbated by foreign exchange pressures.
“We are an import dependent economy. A higher inflation rate will further depreciate the value of the Naira as import prices become more expensive. The foreign exchange challenge remains daunting and addressing this challenge should be of utmost importance.”