Tightening interest rates, others may affect lending, growth — LCCI

The Lagos Chamber of Commerce and Industry (LCCI) has said tightening monetary policy stance would stifle access to credit, and undermine the pro-growth agenda of the Central Bank of Nigeria (CBN).

Headline inflation rose by 17.33% in February 2021, the highest level since March 2017.

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Commenting on the decisions of the Monetary Policy Committee (MPC) of the CBN at the March meeting held on Tuesday, LCCI noted said retaining policy parameters at 11.5% Monetary Policy Rate (MPR), Cash Reserve Ratio (CRR) at 27.5% and Liquidity Ratio at 30% was good for the economy.

LCCI Director General, Dr. Muda Yusuf said: “Holding policy stance seems to be the most appropriate decision at this moment considering the recent macro developments in the economy.

“We believe sustained intervention efforts of the bank would further enhance credit flows to the real economy, stimulate output growth and ultimately moderate inflationary pressures but with the high unemployment rate and weak employment levels in manufacturing and services sector, tightening monetary policy stance would stifle access to credit, and undermine the CBN pro-growth agenda.”