Peter Obi Reacts As CBN Increases Interest Rate: “It’ll Cause Job Loss, Worsen Economy”

• The Labour Party presidential candidate, Peter Obi, has weighed in on the CBN's new interest rate
• Obi disclosed that the interest rate hike will adversely affect the economy and the situation of most Nigerians
• The former governor of Anambra added that the sharp increase in MPR and CRR will result in job loss in the productive sector

Legit.ng journalist Esther Odili has over two years of experience covering political parties and movements.

The flagbearer of the Labour Party (LP) in the 2023 presidential election, Peter Obi, has criticised the recent decision of the Monetary Policy Committee (MPC) to increase the Monetary Policy Rate (MPR) to 22.5% and the Cash Reserve Ratio (CRR) to 45%.

Peter Obi said this will further worsen the economic situation of most Nigerians.

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In a series of posts on his X handle on Thursday, February 29, the former governor of Anambra state said the hike in MPR, also known as interest rate, would be counterproductive as it would not address the intended purpose of managing the money supply.

Obi cautioned that what the Nigerian economy needs now is hard-headed, practical originality, and results. He noted that tinkering with classical economic theories can only deepen the crisis.

He tweeted:

“Let me confess that the label of being a vintage Onitsha-based trader does not in any way confer on me the status of an economic expert. With my vast trading knowledge and my involvement in the real sector, I am of the strong opinion that the recent decision of the Monetary Policy Committee to increase the Monetary Policy Rate, MPR, to 22.5% and the Cash Reserve Ratio, CRR, to 45% will further worsen the economic situation of most Nigerian households as it is bound to cause more job losses in the productive sector, especially manufacturing and other sectors that rely on bank loans and credit facilities for their funding needs.

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“Tightening liquidity in the financial system does not improve productivity, ie food production, which is the major cause of inflation in Nigeria. Moreover, only about 12% of N3.6 trillion of the total money in circulation is in the banking system which means that 88%, about N3.2 trillion is outside the banking system,” he said.

Peter Obi speaks on N30bn allocation to govs

Earlier, Peter Obi entered the scene amidst the conflict between Senate President Godswill Akpabio and Oyo state Governor Seyi Makinde regarding a purported N30 billion grant given to governors by the federal government.

Akpabio called upon governors to account for the allocation, citing unverified reports of its distribution to alleviate citizen hardship.

Obi weighed in on the debate via his official X handle, urging governors to use the contentious funds wisely.

Source: Legit.ng