A financial expert, Mr Sewa Wusu, on Saturday expressed optimism that the reduction in the May inflation rate figure of 16.25 per cent would impact positively on the Nigerian Stock Exchange (NSE).
Wusu, the Head of Research Unit, SCM Capital Ltd, said in an interview with the News Agency of Nigeria (NAN), Lagos, while reacting to the May inflation rate figures released by the National Bureau of Statistics (NBS).
He said the moderation in the headline inflation rate would have positive effect on consumer purchasing power thereby increasing activities in the nation’s bourse.
According to him, the moderation in the headline inflation rate by 94 basis points in the month of May and for the fourth consecutive month is a reflection of the base effects emanating from increased energy prices seen in mid-2016 coupled with the pressure on food prices.
“It is also indicative of the positive impact of a strengthened Naira in the foreign exchange markets,” he said.
Wusu explained that the slower inflation rate was a sign of a decline in the rising cost of goods and services in the country.
NAN reports that NBS on June 15 published Nigeria’s Consumer Price Index (CPI) or inflation rate for the month of May,
indicating the most significant fell since the downward slant began to 16.25 per cent year-on-year from 17.24 per cent in April.
The CPI, which measures the average change over a given time in the prices of goods and services consumed by people in their daily living, represents the fourth consecutive decline in the rate of inflation since January 2017.
The highest contributors to inflation during the period included meat, bread and cereals, solid and liquid fuels, fish, garment and textiles.
A breakdown of the figure shows that food sub-index in May dropped slightly to 19.27 per cent from 19.30 per cent posted in April. (NAN)