By Peter OBIORA InvestAdvocate

Lagos (INVESTADVOCATE)-The National Bureau of Statistics (NBS) has projected an Inflation Rate of 11.91 percent (11.91%) in year 2015 in its review of the Nigerian Economy in 2011 and Outlook for 2012-2015.

The NBS in the Report affirmed that although trending downwards since January 2009, the headline inflation rate determining the cost of living has remained double-digit and is expected to remain so in 2012.

NBS said in the based on the estimates from the Bayesian vector autoregression (BVAR) model, the projected inflation rate in 2012 will be 13.57%; 12.21% in 2013; 12.04% in 2014 and 11.91% in 2015.

According to the Report, there is also the probability that Inflation Rates may trend higher, but the non-accommodative policy stance by the Central Bank of Nigeria (CBN), which targets single-digit Inflation, is expected to keep higher rates of Inflation in check.

“A broader view of the historical and the projected series for Inflation can be gotten from Figure Inflation which is expected to trend up in 2012 mostly due to the lingering effects of the partial removal of the fuel subsidy on food and non food prices as a result of higher transportation costs” the Report said.

NBS further affirmed that Inflation Rates could trend even higher if the Petrol subsidy is fully removed, as expected, towards the end of the year.

The Report further affirmed that the delayed passage of the budget could also imply high volume fiscal releases later in the year, which could further fuel inflationary pressures.

NBS said the Nigeria’s Central Bank’s restrictive monetary policies may dampen inflationary pressures towards 2015, and the final result will depend on what the CBN decides to do with monetary policy.

The Report affirmed that inflationary pressures could have a dampening effect on the Nation’s Gross Domestic Product (GDP) growth as a result of possible higher food prices around the country.

“Inflationary pressures from imported food are another likely source of higher domestic food prices in 2012, as global food prices have been on a steady increase since last year. Lastly, the partial removal of petrol subsidy, which has raised fuel prices in the country by almost 50% will feed into the overall price level further contributing to the inflationary pressures in the economy” the Report said.

It also said the implementation of the import ban policy of Government combined with a possible decline in crude oil export is expected to add further pressure on total trade resulting in its forecast decline in 2012.

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