Criticism and backlash have continued to trail the decision of the Monetary Policy Committee of the Central Bank of Nigeria to raise the interest rate by 50 basis points.
Lending a voice to the discourse, the Lagos Chamber of Commerce and Industry, LCCI, described the monetary policy rate hike as ineffective in curbing rising inflation in Nigeria.
The LCCI’s Director General, Chinyere Almona, wants the Central Bank of Nigeria to look inward and be more creative.
She advises the CBN to explore other viable options for addressing rising inflation.
Related Articles
- Global Stock: Equities Slip, Yields Tumble As Fed’s Rate Hike
- Prime Lending Rate Hits 23-Months High At 13.17%
According to the CBN, the move would help in taming inflation at 21.91% in February.
Disagreeing with the CBN, the LCCI’s boss on Friday insisted that the interest rate hike would have no impact on reducing inflation.
She said: “While the CBN has the overarching mandate of ensuring price stability, we suggest it should not be done in a manner that compromises growth”.
As a result, she insists that increasing interest rate in the face of high unemployment would be counter-productive.
“Inflation chips away at purchasing power leads to inventory stockpiles, undermines growth and creates a lot of economic uncertainties.
“Taming it, however, should not be done at the expense of growth and the most vulnerable sectors”.
Conclusively, she highlights that more than the instrumentality of monetary policy is necessary to guarantee low, stable and predictable prices.
