Market News

Consumer prices rose at a faster annual pace in December, removing any hopes for a rate cut at the Monetary Policy Committee (MPC), later this month.

The consumer price index showed an annual inflation rate of 34.80 percent, the National Bureau of Statistics reported on Wednesday. The annual rate was 0.20 percentage points higher than December.

However, monthly inflation, a more accurate measure of current inflation which gives the current situation, dropped to 2.44 percent from 2.638 percent in November.

Bismarck Rewane, a renowned economist and CEO of Financial Derivatives Company said inflation which has been punishing household incomes and eroding business gains may drop by the second half of the year but predicted that prices will quicken to 35.4 percent in December.

“The moderation in inflation is not going to be as low as we expected. We’re going to be seeing 25 or 27 percent by the end of the year with some luck.”

Rewane explained that since prices are still high, the monetary policymakers may not begin lowering borrowing costs, stating that with inflation cooling later in the year interest rates may begin to slow.

MPC meeting is expected to hold on the 27th and 28th of January t

Food inflation which constitutes more than 50 percent of headline inflation dropped to 239.84 in December from 39.93 percent.

Meanwhile, core inflation on a month-on-month basis, was 2.24 percent in December 2024. It stood at 1.83 percent in November 2024, down by 0.41 percent points