The Lagos Chamber of Commerce and Industry (LCCI) has urged the Central Bank of Nigeria (CBN) to take a cautious stance on monetary policy while providing clear signals of potential interest rate cuts.
The Director-General of LCCI, Dr Chinyere Almona, in a statement on Tuesday in Lagos, made this call following the decision of CBN to maintain the Monetary Policy Rate (MPR) at 27.5 per cent.
Almona said that the advice was necessary due to sustained economic improvements in the country.
She said while the recent marginal decline in headline inflation offered some relief, a cautious stand by the CBN was critical.
Almona noted that in spite of the drop in inflation to 23.71 per cent, Nigeria’s macroeconomic conditions remained harsh.
She said that a premature reduction in interest rates under such conditions could undermine investors’ confidence and raise doubts about the commitment of the CBN to price stability.
“Maintaining the current rate reflects a balanced approach: one that avoids inflationary risks while allowing time for consistent macroeconomic trends to emerge,” she said.
Almona urged the Monetary Policy Committee (MPC) to complement the rate hold with a forward-guided, data-driven roadmap for future easing.
Such a strategy, she said, would provide the business community with the clarity needed for medium-and long-term planning.
Almona stated that key indicators for future rate reductions should include a trend of dis-inflation over at least two to three months, improved foreign exchange parameters and concrete signs of recovery in the real sector.
She, however, noted that the current MPR level remained prohibitively high for private sector development, particularly for Micro, Small, and Medium Enterprises (MSMEs).
Leave a Reply
Leave a Reply
