The Central Bank of Nigeria (CBN) has released a new survey that paints a concerning picture of the financial struggles facing Nigerian households. According to the survey, a majority of Nigerians are prioritizing essential items like food and education over non-essential purchases due to the ongoing economic challenges.
Survey Findings
The CBN’s Household Expectation Survey, conducted between July 22 and 26, 2024, surveyed 1,665 households across Nigeria. The findings reveal that the primary areas of spending for the next six months include food and other household items, education, transportation, electricity, and medical expenses.
While consumers plan to allocate a significant portion of their income to these essential items, they have indicated that they intend to cut back on non-essential purchases. Big-ticket items such as houses, cars, and household appliances, as well as investments like acquiring landed properties or other forms of investments, are not a priority for most Nigerians at this time.
Economic Challenges and Naira Depreciation
The survey also highlights the impact of economic challenges on Nigerian households. Respondents expressed concerns about the ongoing depreciation of the naira, with many expecting it to continue to fall in the coming months. The local currency has experienced significant volatility in recent times, reaching a low of N1,639 per US dollar in August.
The CBN’s monetary policy decisions have been aimed at addressing these challenges. The bank has increased the benchmark interest rate to 26.75% to curb inflation. While this measure has shown some positive results in slowing inflation, it has also led to higher borrowing costs for businesses.
Inflation and Rising Costs
Inflation has been a major concern for Nigerian households. Despite a slight decline in the consumer price index (CPI) in July, it remains at a 28-year high. Rising prices have put a strain on household budgets and forced many to make difficult choices.
Read Also: State Governments Receive N2.958 Trillion Allocation in H2 2024
The CBN’s survey also revealed that respondents believe the economy will likely weaken if inflation continues to rise at a faster pace. This sentiment underscores the deep-rooted concerns about the economic outlook.
If You Ask Me
The CBN’s survey provides a stark reminder of the economic challenges facing Nigerian households. As the country grapples with rising inflation, unemployment, and a depreciating currency, many are prioritizing essential items and making sacrifices to weather the storm. The government and policymakers will need to implement effective strategies to address these challenges and improve the economic well-being of Nigerian citizens.
