CBN warns Middle East tensions and election spending could slow disinflation

The Central Bank of Nigeria has warned that tensions in the Middle East and election-related spending could disrupt the country’s progress in reducing inflation, according to Premium Times Nigeria. The bank said the outlook for the domestic economy remained positive. At the same time, it identified external and domestic risks that could undermine the moderation of inflation.

The external risk cited in the supplied material is the effect of tensions in the Middle East. The domestic risk is election spending. The report does not explain the channels through which either factor could affect prices, nor does it provide forecasts, inflation figures or a timetable for the expected impact.

The CBN’s warning indicates that it views the recent moderation in inflation as vulnerable to developments beyond the immediate performance of the domestic economy. However, the supplied account does not state whether the bank announced any new policy measures or changed its assessment of interest rates, currency conditions or growth. Premium Times Nigeria reported the warning while describing the economic outlook as positive but exposed to both external and domestic pressures.