A renowned economist and the former President and Chairman of the Council of Chartered Institute of Bankers, Prof Segun Ajibola, has revealed what the Central Bank of Nigeria must do to tame rising inflation.
According to GISTS VILLA, Ajibola disclosed this on Wednesday on the heels of the recent hike in Monetary Policy Rates by CBN to 18.75 per cent.
He faulted the CBN Monetary Policy Committee’s decision to hike interest rates amid hardship.
Recall that CBN raised the interest rate from 18.50 to 18.75 per cent in its July MPC meeting to tame inflationary pressures.
But Ajibola said the best way to tame inflation in Nigeria is to address the rising costs of production components.
He said:”…To reduce inflation in Nigeria, rising costs of components of production inputs need to be stemmed as the country puts measures in place to strengthen the value of the Naira.
“The often-cited excessive reliance on importation must be tackled headlong. Manipulating MPR to curb inflation works better if the critical cause is demand-pull”.
Nigeria’s June inflation figure is 22.79 per cent according to the National Bureau of Statistics.