Nigeria’s inflation rate may hit 30% by December 2023 —KPMG

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Klynveld Peat Marwick Goerdeler (KPMG), a global financial advisory service firm, has predicted that Nigeria’s headline inflation rate will rise to 30% by December 2023. In its macroeconomic review for the first half of 2023 and outlook for the second half (H2), KPMG stated that the fuel subsidy removal and unification of the foreign exchange market will drive up the prices of goods and services. The report also revealed that the current MPR hike being adopted by the apex bank in the last 18 months has not been effective in stalling the increasing inflationary trend. However, the report advised that addressing issues such as energy and transportation costs, supply chain problems, and boosting local production will be more effective than increasing interest rates.


Regarding GDP growth, KPMG projected that Nigeria’s economy will grow by 2.6% in 2023, which is lower than the revised World Bank’s 2023 forecast of 2.8% for Nigeria and the 3.1% growth rate achieved in 2022. The report asserts that recent macroeconomic malaise during the first half of the year, such as the failed naira redesign policy, weak growth due to low crude oil output, high inflation, and the fuel subsidy removal, will have negative ripple effects in the second half of the year.

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