Ahead of the Central Bank of Nigeria Monetary Policy Committee (MPC) meeting, the House of Representatives Committee on Economic Planning has called on the CBN to reconsider its continued tightening of monetary policy.
The committee expressed concerns that persistent rate hikes could further stifle growth, especially in the manufacturing sector, and worsen unemployment.
Gboyega Nasiru, chairman of the Committee, made this call during an oversight session with Adeyemi Adeniyi, the National Bureau of Statistics (NBS) Boss and his team on Wednesday.
According to him, the recent trajectory of monetary policy tightening intended to curb inflation have had unintended consequences due to structural challenges.
“It is important to note that the high interest rates have had significant unintended consequences on growth, particularly in manufacturing, which are significant employers of labor.
“The NPR has been raised ten times since January 2023, currently standing at 27.5% from 16.5% in 2023. However, it will appear that the effectiveness of this policy has been undermined by structural bottlenecks, supply chain deficiencies, and some other challenges that we have as a country in the economy”, he argued.
Ahead of the meeting next week, Nasiru urged the apex bank to adopt a more accommodative approach that prioritises growth and employment.
“It is our view that considering the current economic landscape, the monetary authorities as they meet next week should consider a more accommodative stance that promotes growth and employment generation.
” I think the bottom line of this is that, we all know that increasing rates is a common phenomenon in public inflation, but this should not be done at the expense of growth and employment. And we think that having raised interest rates ten times collectively every quarter, I think the CBN and the MPC should consider a more accommodative growth that can promote growth and promote employment”, he urhed.
The chairman, further underscored the importance of the NBS in shaping national development through accurate, timely, and credible data.
He said the session aimed to provide the NBS with an opportunity to clarify concerns regarding the integrity of its data and to reaffirm its role as a trusted institution.
