The Central Bank of Nigeria (CBN) has warned that Nigeria could find herself back in a recession if current trends continue.
The Monetary Policy Committee, an arm of the CBN, said that if Nigeria doesn’t take steps to implement the 2018 budget, create employment and increase the minimum wage, then another recession could hit the country.
The recession is still fresh in the minds of Nigerians as the nation only escaped the situation in 2017 after five consecutive quarters of economic contraction.
Speaking to newsmen at the end of a two-day session with MPC members which was held in the CBN headquarters, the Governor, Mr Godwin Emefiele announced that the Nigerian economy is already showing signs of weakness.
“The MPC observed that despite the underperformance of key monetary aggregates, headline inflation inched up to 11.23 per cent in 2018 from 11.14 per cent in July 2018.” said the CBN President
READ: Nigeria’s inflation rate to fall to single digit in mid-2018, says CBN Gov.
“The near time upside risks to inflation remain the dissipation of the base effect expected from 2019 election-related spending, continued herdsmen attacks on farmers and episode of flooding which destroyed farmlands and affected food supply ultimately.
“Relative stability has returned to the foreign exchange market buoyed by the robust external reserves with inflation trending downward for the 18th consecutive month.”
The CBN Governor also said: “the committee was concerned that the exit from the recession may be under threat as the economy slowed to 1.95 and 1.50 per cent during the first and second quarters of 2018 respectively.
“The committee noted that the slow down emanated from the oil sector with strong linkages to unemployment and growth in other key sectors of the economy.
“In this regard, the committee urged the government to take advantage of the current rising trend in oil prices to rebuild fiscal buffers, strengthen government finances in the medium term and reverse the current trend of decline in output growth.”