- Safiu Kehinde
The Monetary Policy Committee (MPC) has revealed that uprising in food inflation is caused by hike in price of energy, fuel scarcity, flooding, and insecurity.
This was dsiclosed by the Central Bank of Nigera’s (CBN) Governor, Olayemii Cardoso, while delivering the report of MPC meeting to newsmen.
Cardoso, who also doubled at the committee’s chairman, stressed on the spate of insecurity in farming communities as the major cause of the nflation.
“On food inflation, the upside risk remains; flooding, a hike in energy prices, scarcity in PMS and most importantly, security in farming communities.” Cardoso said.
However, Cardoso lauded the efort of the Federal Government in addressing the issue of insecuirty.
“Considering the weight of food in the CPI basket, members recognize the effort of FG in addressing insecurity in the farming communities and stress the need to remain steadfast.
“The MPC applauded the ongoing effort of the FG to breache the supply deficit through duty-free import window for food commodities.” He said.
Meanwhile, MPC expressed optimism in the reduction of fuel price and transportation cost with the operation of Dangote refinery, which they claimed will ease food inflation and also moderate foreign exchange rate.
“The committee express optmisim that the lifting of refined petrol products from Dangote refinery will moderate transportation cost and significantly support the easing of food price in the short to medium term.
“This is also expected to moderate foreign exchange demand for importation of refined petroleum products with the positive spillover on external reserve and improvement in the overall balance of payment position.” Cardoso added.