The recent hike in the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN) has failed to achieve its intended goal of curbing inflation, according to Taiwo Oyedele, a renowned tax expert and Chairman of the Presidential Fiscal Policy and Tax Reforms Committee.
In a recent interview, Oyedele argued that the MPR hike has instead stoked inflation, exacerbating the economic challenges facing Nigerian businesses and households. “The hike in MPR is not addressing the root causes of inflation, which are largely driven by supply-side factors such as fuel scarcity, insecurity, and forex volatility,” Oyedele said.
Oyedele’s comments come on the heels of the CBN’s decision to raise the MPR to 18% in a bid to tame rising inflation, which has hovered above 20% in recent months. However, Oyedele believes that this approach is misguided and will only serve to further stifle economic growth.
“The CBN’s decision to hike the MPR is a classic case of using a blunt instrument to address a complex problem,” Oyedele said. “What Nigeria needs is a more nuanced approach that addresses the root causes of inflation, rather than just treating the symptoms.”
Oyedele’s views are echoed by many economists and business leaders, who argue that the CBN’s monetary policy framework needs to be revised to take into account the unique challenges facing the Nigerian economy. As the inflationary pressures continue to mount, it remains to be seen whether the CBN will revisit its policy stance and adopt a more targeted approach to addressing the country’s economic challenges.
