SURVEY ON CBN RATE CUT EXPECTATIONS
Overview:
- Survey: A survey conducted by the Statistics Department of the Central Bank of Nigeria (CBN) gathered respondents' views on whether the interest rate should have been adjusted in July.
Survey Results:
- Majority's Opinion: About 74.2% of respondents believed that the CBN should have reduced the interest rate in July.
- Minority's Opinion: 12.4% of respondents were in favor of raising the interest rate.
- Unchanged Rate: 13.4% of respondents thought the interest rate should have remained unchanged.
CBN's Decision:
- Interest Rate Adjustment: Despite the survey results, the Monetary Policy Committee of the CBN increased the benchmark interest rate by 50 basis points to 26.75%. This marked the fourth rate hike within a span of seven months.
- Reason for the Hike: The CBN Governor, Olayemi Cardoso, explained that the rate increase was in response to ongoing inflationary pressures, indicating the bank's continued stance on curbing inflation.
Respondents' Views on Inflation:
- Perception of Inflation: Both businesses and households surveyed believed that the inflation rate in July was high.
- Key Drivers of Inflation: Respondents identified changes in the price of energy, exchange rate fluctuations, and transportation costs as the primary drivers of inflation during the month.
Inflation Statistics:
- Inflation Rate: According to the National Bureau of Statistics, Nigeria's inflation rate moderated to 33.40% in July, down from 34.19% in June.
Survey Methodology:
- Conducted in July: The survey was conducted between July 14-26, involving selected businesses and households across Nigeria, with a sample size of 1,600 businesses and 1,650 households.
- Purpose: The Inflation Expectations Survey (IES) aimed to gather insights into how businesses and households perceive current and future inflation trends, as well as the factors driving these trends.
Conclusion:
The CBN's decision to raise the interest rate, despite the majority of survey respondents favoring a rate cut, reflects the central bank's commitment to addressing inflation. However, the survey highlights the widespread concern about the high inflation rate and its drivers among businesses and households in Nigeria.
Overview:
- Survey: A survey conducted by the Statistics Department of the Central Bank of Nigeria (CBN) gathered respondents' views on whether the interest rate should have been adjusted in July.
Survey Results:
- Majority's Opinion: About 74.2% of respondents believed that the CBN should have reduced the interest rate in July.
- Minority's Opinion: 12.4% of respondents were in favor of raising the interest rate.
- Unchanged Rate: 13.4% of respondents thought the interest rate should have remained unchanged.
CBN's Decision:
- Interest Rate Adjustment: Despite the survey results, the Monetary Policy Committee of the CBN increased the benchmark interest rate by 50 basis points to 26.75%. This marked the fourth rate hike within a span of seven months.
- Reason for the Hike: The CBN Governor, Olayemi Cardoso, explained that the rate increase was in response to ongoing inflationary pressures, indicating the bank's continued stance on curbing inflation.
Respondents' Views on Inflation:
- Perception of Inflation: Both businesses and households surveyed believed that the inflation rate in July was high.
- Key Drivers of Inflation: Respondents identified changes in the price of energy, exchange rate fluctuations, and transportation costs as the primary drivers of inflation during the month.
Inflation Statistics:
- Inflation Rate: According to the National Bureau of Statistics, Nigeria's inflation rate moderated to 33.40% in July, down from 34.19% in June.
Survey Methodology:
- Conducted in July: The survey was conducted between July 14-26, involving selected businesses and households across Nigeria, with a sample size of 1,600 businesses and 1,650 households.
- Purpose: The Inflation Expectations Survey (IES) aimed to gather insights into how businesses and households perceive current and future inflation trends, as well as the factors driving these trends.
Conclusion:
The CBN's decision to raise the interest rate, despite the majority of survey respondents favoring a rate cut, reflects the central bank's commitment to addressing inflation. However, the survey highlights the widespread concern about the high inflation rate and its drivers among businesses and households in Nigeria.