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Rewane predict rise in August inflation rate

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After falling for the 18th consecutive time to 11.14 per cent in July, Nigeria’s inflation rate could marginally rise to 11.15 per cent in August, the Chief Executive Officer, Financial Derivatives Company Ltd, Mr. Bismarck Rewane, has predicted.

He made the forecast in the FDC’s latest Lagos Business School (LBS) Executive Breakfast Session series, obtained by New Telegraph at the weekend.

Although he did not give details of how he arrived at this conclusion in the report, the financial expert, had while commenting on June inflation data on a television programme in July, told consumers to prepare for rising inflation from August 2018.

He stated that: “The consumers have to prepare themselves, we are going into a planting season, we are going into minimum wage negotiation, we are going into budgetary spending, we have to prepare ourselves for an increase in inflation after 17 months of consecutive decline, inflation is set to start increasing from next month.

“There is no question about that; that is the likely outcome.”

However, in a report released at the weekend, analysts at FSDH Research said they expected the inflation rate (year-on-year) to remain unchanged at 11.14per cent in August 2018, the same rate recorded in the month of July.

The analysts stated: “Although we observed moderation in the prices of some food items in August, the contraction in the agriculture sector may place pressure on food prices in coming months.”

There are indications that the National Bureau of Statistics (NBS) will release the inflation rate for the month of August on 14 September 2018.

Meanwhile, Rewane has also forecast that the Central Bank of Nigeria (CBN) is likely to leave rates unchanged when its Monetary Policy Committee (MPC) meets later this month.

Other forecasts by the FDC boss are that external reserves will fall below $45billion; the naira will fall marginally to N362 per dollar in the parallel market; outflow of Foreign Portfolio Investments (FPI) will continue and growing political uncertainty will continue to hurt investor confidence in the capital market, leading to the stock market further falling into correction territory.

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