National Economy
Sunday, August 31, 2025
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy
No Result
View All Result
Read News
National Economy
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy
No Result
View All Result
National Economy
No Result
View All Result
Home Lead-In

Nigeria, Others Require Extended Monetary Tightening To Tame Inflation – IMF

by Caleb Owaise
9 months ago
in Lead-In
Reading Time: 2 mins read
Monetary
Share on FacebookShare on TwitterShare on Telegram

You May Like

FG Threatens Oil Licence Revocation As Output Hits 1.8m

ICRC Hands MDAs PPP Approval Powers Below ₦20bn

Nigeria and other sub-Saharan African (SSA) countries, where inflation remains persistently high and significantly exceeds central bank targets, will need prolonged monetary tightening to combat the ongoing price crisis, according to the International Monetary Fund (IMF).
The IMF made this recommendation in its SSA Regional Economic Outlook, just released. However, the Fund warned that excessively tight monetary policies could intensify social tensions. It urged policymakers to implement measures that alleviate the burden on the most vulnerable individuals and households.
Nigeria’s inflation rate, currently over 33 per cent, far outpaces the rest of the continent. The Central Bank of Nigeria (CBN) has responded by raising the interest rate to 27.25 per cent, maintaining a strong stance on curbing inflation despite potential adverse economic effects. At the recent World Bank/IMF Annual Meetings, Wale Edun, Minister of Finance and Coordinating Minister of the Economy, emphasised that it would be premature for the monetary authorities to consider reducing rates.
With inflation resuming its upward trajectory due to holiday-driven spending, the CBN’s Monetary Policy Committee (MPC) is expected to increase the already elevated interest rate during its upcoming meeting.
The IMF noted that countries with more moderate economic imbalances could consider easing monetary policies toward a neutral stance, provided they carefully monitor inflation outcomes, expectations, and exchange rate fluctuations due to their impact on inflation. A gradual easing of monetary policy could also help mitigate the high costs associated with public debt servicing.
Within the SSA region, interest rate policies vary significantly. Nigeria’s rate of 27.25 per cent is the highest, while countries like those in the West African Economic and Monetary Union (WAEMU), Botswana, and Mauritius maintain much lower rates of 4 to 6 percent. Analysts warn that another interest rate hike in Nigeria could push commercial lending rates to nearly 40 per cent, discouraging private investments. Pro-private sector advocates have called on the CBN to consider easing monetary policy to unlock funding critical for economic growth.
The IMF also highlighted the potential benefits of increased exchange rate flexibility for some SSA countries, suggesting that it could support policy adjustments. However, the Fund cautioned that such moves might pose financial stability risks, particularly due to currency mismatches on banks’ balance sheets. To address these challenges, it recommended stronger capital buffers and improved regulatory frameworks.
Debt sustainability emerged as another critical issue in the IMF’s report. It noted that some SSA countries might face inevitable debt restructuring, a process that could ease fiscal pressures but comes with “significant economic and social costs.”
The Fund emphasised that achieving macroeconomic stability would require a carefully calibrated policy mix, tailored to the size of economic imbalances and political constraints. In many cases, frontloaded adjustments may be necessary due to tight financing conditions. While this approach could boost the credibility of economic reform plans and reduce sovereign borrowing costs, it risks aggravating economic hardships and intensifying social tensions, potentially undermining public support for reforms.
To simplify its recommendations, the IMF outlined three broad scenarios for policy adjustments, while stressing that decisions must remain specific to each country’s unique circumstances.

Tags: INFLATIONMonetary
ShareTweetShare
Previous Post

Nigeria’s IDA Debt Reaches $17.1bn In September

Next Post

endless Grid FAILURES: Stakeholders Push For Decentralised Grid System

ANOTHER GOOD READ

FG Threatens Oil Licence Revocation As Output Hits 1.8m
Lead-In

FG Threatens Oil Licence Revocation As Output Hits 1.8m

6 days ago
ICRC Hands MDAs PPP Approval Powers Below ₦20bn
Lead-In

ICRC Hands MDAs PPP Approval Powers Below ₦20bn

6 days ago
First Time Since 2021: Nigeria’s FX Reserves Hit $41bn
Lead-In

First Time Since 2021: Nigeria’s FX Reserves Hit $41bn

6 days ago
NAMA Commences Audit Of Nigerian Airspace
Lead-In

NAMA Commences Audit Of Nigerian Airspace

6 days ago
Nigeria Risks Creating N50bn Parallel Shadow Fraud Economy-Experts
Cover

Nigeria Risks Creating N50bn Parallel Shadow Fraud Economy-Experts

6 days ago
FG Releases N5.12bn Pension Arrears To 90,689 Retirees
Lead-In

FG Releases N5.12bn Pension Arrears To 90,689 Retirees

2 weeks ago
Next Post
endless Grid FAILURES: Stakeholders Push For Decentralised Grid System

endless Grid FAILURES: Stakeholders Push For Decentralised Grid System

Most Recent

Federal Gov’t Approves ₦142bn For Bus Terminals In 6 Geopolitical Zones

Federal Gov’t Unveils Boards Of South, West, North Dev’t Commissions

August 29, 2025
Manager, 2 Others Nabbed For Alleged Theft, Vandalism At Abia Firm

Police Arrest Suspected Cult Kingpin, 3 Vandals In Akwa Ibom Raids

August 29, 2025
‘How I Became Bank Manager At 27’ — Tony Elumelu

‘How I Became Bank Manager At 27’ — Tony Elumelu

August 29, 2025
Mixed Reactions Trail Federal Govt’s Passport Fee Hike

Mixed Reactions Trail Federal Govt’s Passport Fee Hike

August 29, 2025
Oyo Gov’t Denies False Pensioner Verification Notice

Oyo Gov’t Tackles APC Over N300bn ‘Fresh’ Loan Claim

August 29, 2025
US Says Nigeria’s N70,000 Minimum Wage Below Poverty Income Level

Passport Now Costs More Than Minimum Wage’, Obi Slams Federal Gov’t Over Fees Hike

August 29, 2025
Global Airlines Group Pushes To Raise Pilot Retirement Age To 67

Global Airlines Group Pushes To Raise Pilot Retirement Age To 67

August 28, 2025
Dangote Hails Tinubu Over NNPCL Leadership Choice

Dangote Signs $2.5bn Deal To Build Fertiliser Plant In Ethiopia

August 28, 2025
Advertise with us

© 2024 | National Economy

No Result
View All Result
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy

© 2024 | National Economy