In more bad news, the International Monetary Fund (IMF) has projected that Nigeria’s economy will contract by about 1.8% this year. It also added that the contraction may constraint the growth of the entire region.
The Washington-based Institution cut its 2016 growth forecast for Nigeria from 2.3 percent projected in April, according to its World Economic Outlook update released on Tuesday. The projection for next year was reduced to 1.1 percent from 3.5 percent.
The Central Bank of Nigeria had in its press release introducing the flexible exchange rate policy also predicted that Nigeria will confirm it’s in a full-blown recession when the NBS releases its second quarter GDP report.
On Tuesday, the National Bureau of Statistics confirmed that Nigeria’s Inflation rate had spiked to an 11 year low of 16.5%. Nigeria is currently in a period of Stagflation, where inflation rate is galloping and GDPGrowth rate is declining. History shows that it’s a difficult position to be in for any country.
The Nigerian Economy has been in turmoil ever seen the price of oil started crashing in 2014 resulting in lower government revenue, loss of investments in critical sectors of the economy and foreign exchange outflows from Nigeria. This was also made worse by several flawed economic policy decisions made by the current government.