Guys, Inflation in Nigeria currently sits close to 20.04%😥

We all know that a double-digit inflation rate is like poison to an economy…  But let’s be frank; Some people enjoy inflation like a juicy piece of golden brown plantain.

Without further ado, here are the big winners and losers of an inflation season:

– GAINERS

Governments and Businesses

Governments and large companies with high debt are noticeable winners of an inflation season. Both entities pay back borrowed funds for less than their original value.  Businesses benefit by increasing the price, to which the extra revenue is used to offset debts quickly.

Landlords

Notice how rent increases when garri increases? In seasons of inflation, landlords are protected because the value of their assets increases with inflation. 

See why it’s good to save some and invest some? 

High-risk Investors.

This one is self-explanatory…. The higher the risk, the higher the return on investment. This doubles when there’s inflation.

LOSERS – Compulsive Savers

Most banks offer a savings interest rate of 1.25% to customers… With an inflation rate of 19-21% saving everything in the bank is not a wise decision except if saving for a purpose or project.

Fixed income earners 

Being a salary earner in inflation is torture when there’s no upward salary review. This is because the purchasing power of your salary is decreasing monthly (if not weekly) during periods of high inflation.

The N50k in January of last year is way more valuable than the N50k of this month.

Exporters

If an inflation rate of a country is higher than its commercial competitors, the goods of the said country will become less competitive, and exporters will see a decline in demand and struggle to sell their goods.

THANKS FOR READING!

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