
As the Central Bank of Nigeria (CBN) prepares for its 300th Monetary Policy Committee (MPC) meeting, lawmakers have raised fresh concerns over the adverse effects of high interest rates on key economic sectors.
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Reps Call for Review Ahead of MPC Meeting
In the latest news from the House of Representatives Committee on National Planning and Economic Development, Chairman Hon. Gboyega Isiaka has warned that the CBN’s monetary tightening could further damage the manufacturing, agricultural, and SME sectors.
Speaking during a meeting with the Statistician General of the Federation, Adeyemi Adeniran, Isiaka highlighted the negative impact of elevated interest rates on businesses and employment in Nigeria.
Monetary Policy Rate Up, But At What Cost?
According to Isiaka, the Monetary Policy Rate (MPR) has been increased 10 times since January 2023—rising from 16.5% to 27.5%—in a bid to tackle demand-pull inflation. However, this aggressive policy stance is taking a toll on businesses, especially small and medium enterprises.
“The effectiveness of this policy has been undermined by structural bottlenecks and supply chain inefficiencies,” he said. “The interest rate hikes are slowing down growth and job creation.”
Economic Progress Amid Challenges
Despite the setbacks, Isiaka acknowledged that the government’s market-oriented reforms were yielding positive results. He pointed to the 100% growth in the Nigerian capital market over the past two years and a recovery in CBN’s external reserves and profitability—moving from a loss of N1.15 trillion in 2023 to a profit of N38.8 billion.
Still, the lawmaker urged the CBN to balance inflation control with growth stimulation. “The CBN must adopt a more accommodative policy that supports productivity and employment,” Isiaka added.