Economists are calling on the Central Bank of Nigeria (CBN) to shift its focus towards addressing supply-side factors, cost-push influences, and structural issues that are driving inflation in the country.

Despite multiple interest rate hikes, inflation continues to rise. On May 24, the CBN raised the Monetary Policy Rate (MPR) to 18.5% from 18%.

The MPR serves as the baseline interest rate in the economy, influencing other interest rates within it.

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However, economists argue that the CBN needs to address factors such as increased production costs due to supply chain disruptions, exchange rate instability, and heightened price expectations resulting from fiscal challenges.

They emphasize that the consequences of the CBN’s policies, such as the redesign of the naira and the cashless initiatives, still impact inflation.

Economists express concerns that the repeated rate hikes have limited access to credit for micro, small, and medium-sized enterprises and may not effectively curb inflation.