By Niyi Jacobs
The World Bank has given a thumbs up to the Central Bank of Nigeria’s (CBN) decision to raise interest rates to 27.25%, a move that has sparked both surprise and admiration globally. The CBN’s Monetary Policy Committee (MPC), led by Governor Yemi Cardoso, has implemented five interest rate hikes since his tenure began, totaling over 800 basis points.
“The CBN’s aggressive rate hike is a bold move that shows the bank’s commitment to addressing inflationary pressures and maintaining economic stability,” said Indermit Gill, Senior Vice President of the World Bank Group. “The 850 basis point increase in interest rates over nine months is a significant step towards achieving this goal.”
Gill praised Governor Cardoso’s leadership, stating that the CBN’s monetary policies are steering Nigeria in the right direction. “Implementing comprehensive reforms requires strong political commitment, and Governor Cardoso has demonstrated this commitment through his leadership,” Gill said.
The World Bank believes that Nigeria is on the right course and must stay committed to its policies for at least 10 to 17 years to transform its economy and become a global engine in the Sub-Saharan African region. “Nigeria has the potential to become a leading economy in Africa, and the CBN’s policies are a crucial step towards achieving this goal,” Gill said.
The CBN’s decision to raise interest rates reflects its commitment to addressing inflationary pressures and maintaining economic stability, despite the challenges posed by rising inflation and public demand for lower borrowing costs. “The CBN is taking a long-term view and making difficult decisions to ensure the stability of the economy,” Gill said.
Overall, the World Bank’s endorsement of the CBN’s rate hike is a vote of confidence in Nigeria’s economic policies and a testament to the bank’s commitment to supporting economic growth and development in Africa.
