The Executive Director of the British Nigeria Business Network (BNBN), Amb (Dr) Ubani Ifeanyi,, has lauded the recent decision by the Central Bank of Nigeria (CBN) to raise the Monetary Policy Rate (MPR) by 200 basis points to 24.75%, stating that it signifies a significant step towards curbing inflation.
“Increasing interest rates is a crucial move by the central bank, indicating its commitment to reducing the money supply in the economy and potentially alleviating inflationary pressures,” remarked Amb (Dr) Ifeanyi.
He opined that the hike in interest rates serves as a signal of the CBN’s intent to tighten monetary policy, making borrowing more expensive and likely curbing spending.
The effectiveness of this measure in addressing inflation, according to him, depends on various factors, including the root causes of inflation and the response of consumers and producers to changes in interest rates.
Dr. Ubani further posits that while the increase in interest rates may have the desired effect of containing inflation, it could also have adverse effects on short-term economic growth.
The finance expert who is the African Representative of British African Business Alliance (BABA) Network advises that monitoring the economy’s response to this policy adjustment in the coming months is essential to evaluate its impact on inflation, with factors such as consumer spending, investment levels, and price stability providing crucial insights.
