Former Deputy Governor of the Central Bank of Nigeria, Kingsley Moghalu, has called for greater fiscal discipline in order to reduce the country’s deplorable inflation rate.
Mr Moghalu said in a tweet on Monday, in response to a suggestion that restricting money flow has led to a drop in the inflation rate in the United States of America, he said Nigeria will require more than reducing the country’s money supply to reduce inflation.
“In Nigeria it may require far more than reducing the money supply to reduce inflation, though that is also necessary. Supply side and structural factors will have to be addressed. Fiscal discipline by fiscal authorities is essential too,” Tweet by Moghalu read.
The suggestion comes as the country’s inflation rate continues to rise.
In May, Nigeria’s inflation rate rose to 22.41% from 22.22% recorded in the previous month.
The biggest economy in Africa is experiencing a cost-of-living crisis, which is being exacerbated by the removal of subsidies, the devaluation of the naira, and the imposition of a value-added tax on diesel imports.
According to the World Bank’s most recent Nigeria Development Update report, published in June 2023, the loss of purchasing power brought on by high inflation has pushed an estimated four million Nigerians into poverty between January and May 2023.
93.8 million Nigerians, up from 89.8 million at the start of the year, were projected to be living in poverty as of May 2023, according to estimates from the World Bank and the National Bureau of Statistics (NBS).
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