This information was shared by Bismarck Rewane, CEO of Financial Derivatives Company, during an appearance on Channels Television’s News at 10 on Friday.
Rewane emphasized the significant measures taken to address exchange rate fluctuations and inflation issues, particularly in light of the recent Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN), which decided to maintain the Monetary Policy Rate (MPR) at 27.50% on Thursday.
He pointed out that the government has not only allocated substantial funds to defend the currency but has also secured additional financing through debt instruments.
“We’ve also borrowed $4 billion in bond issues. When you take a look at that, you’ll see there is a lot of work. We’ve actually spent almost $8 billion trying to support the naira at current levels,” Rewane remarked.
Regarding the recent rebasing of Nigeria’s inflation data, Rewane addressed the confusion surrounding the country’s economic situation. He presented three distinct methods of calculating inflation, each yielding different results:
- Old Method: Inflation is recorded at 34.8%
- New Method (Rebased Data): Inflation decreases to 24.4%
- Market Survey (Real Inflation): Inflation is estimated to be around 33%
Expressing doubt about the significant drop indicated by the new inflation figures, he remarked that these statistics may not accurately represent the experiences of ordinary Nigerians.
“There’s no way that inflation can reduce by 10% in a short period. The man on the street does not believe that inflation has come down as sharply as that,” he said.
The persistent strain on the naira, along with uncertainties surrounding inflation, raises doubts about the efficacy of government measures aimed at stabilizing the economy.
Although official statistics indicate a moderation in inflation, the realities faced by consumers suggest otherwise, as they continue to deal with increasing living expenses.
In announcing the Monetary Policy Committee's (MPC) decision, CBN Governor Olayemi Cardoso stated that the MPC observed with satisfaction recent positive macroeconomic developments anticipated to favorably influence price dynamics in the near to medium term. These developments include foreign exchange market stability, leading to exchange rate appreciation, and moderation in PMS prices.
However, the MPC acknowledged persistent inflationary pressures, primarily driven by food prices, and noted the National Bureau of Statistics' (NBS) recent rebasing of the consumer price index (CPI), which adjusted item weights to reflect current consumption patterns.