Nigeria’s rate hike not impactful: Analysts
Analysts believe the increase in Monetary Policy Rate by the Monetary Policy Committee of the Central Bank of Nigeria by one hundred basis points to 14 per cent, is not impactful until a general increase in interest rates. CNBC Africa spoke to Bismarck Rewane, the CEO of Financial Derivatives and Abdulrahman Yinusa, a Former Council Member of the Chartered Institute of Bankers of Nigeria.
Tue, 19 Jul 2022 14:15:44 GMT
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AI Generated Summary
- The limitations of using interest rates as a tool to combat cost-push inflation in Nigeria.
- The mismatch between GDP growth and money supply growth in Nigeria, leading to inflationary pressures.
- Challenges in the Nigerian economy's production system and the need for increased productive capacity to address supply-side constraints.
The recent decision by the Monetary Policy Committee of the Central Bank of Nigeria to raise the Monetary Policy Rate by one hundred basis points to 14 per cent has sparked discussions among financial analysts and experts. Bismarck Rewane, the CEO of Financial Derivatives, and Abdulrahman Yinusa, a Former Council Member of the Chartered Institute of Bankers of Nigeria, shared their insights in a recent interview on CNBC Africa. Despite the rate hike, analysts believe that the impact may not be significant until there is a general increase in interest rates across the board. Rewane and Yinusa delved into the various factors affecting Nigeria's economy and shed light on the complexities of monetary policy decisions in the current environment. The discussion highlighted the challenges faced by the Central Bank in addressing inflation and stimulating economic growth effectively.
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