Ogiame:
The clown called Cardoso and his master does not have anything upstairs.



God will continually bless you your Excellency.

Obi is the biggest clown

BreconHills:


Has this guy heard of short, medium, and long-term strategies? Do you want the Government to adopt medium-term strategies while the ordinary people continue suffering? High interest rates will squeeze money supply which impacts demand push inflation. Cost-push (dollar component) inflation will also be addressed as wide money supply fuels irrational pricing of the USD.

The casualty will be growth but that is how economic policy works - there is always a trade-off. But what is the point of growth that benefits no one? Growth with death? - no o. Manufacturing can be addressed with target-specific concessional lending and grants. There is still a massive multi-billion one out there as we speak.

It is easy but dishonest to capitalize on ignorance.

I wonder his logic sincerely.
The problem everyone has been repeating is that there are too many naira chasing few items.
A reduction in interest rates means bank will give out more naira to the economy, while the interest of savings increase, thus, some dumping the naira idle in different forms, Fixed dep, savings account, TB, etc.
With the increase in interest rates, some people will take out the funds they've dumped for productive use, there by reducing the money in circulation

senatordave1:


Obi is the biggest clown

Will that make you stop crying? 🤣

Plut0cracy:


With your cheap android phone and 2k data you just called obi a boy judge yourself oh

Boy --- Seek some anger management help and don't assume everyone faces the same money problems as you do

Obi is wrong here. This was a long overdue step. But there should be a set target. After that target is met, they can gradually ease rates. There should be a revision of tax rates also and streamlined or digital taxation for the working populace. This in combination with reduced cost of governance, improved security and more mechanized farming will get the job done

Tareq1105:
So Obi, a trader and a philosophy graduate is more knowledgeable than those MPC members whose decisions have been applauded by experts like Prof Kingsley Moghalu and others on TV and Radio discussions?

Does Obi have access to all the information at the disposal of MPC members?

He that thinks he's wise is the most foolish.

I rarely respond to this kind of beer parlor advice from a brewer who must have taken some cups before speaking.

Usually Obi sticks to nice-sounding but empty generalities, which makes it hard for listeners to make meaningful assessments of his supposedly "constructive" suggestions. Today, for once Obi does have something concrete to say, and all it ends up revealing is that he has nothing upstairs!

Wanting interest rates to remain below the level of inflation while endlessly complaining about a weak Naira is nonsense of the highest order. Anyone who can entertain such foolishness has never heard of "interest rate parity"

https://www.investopedia.com/terms/i/interestrateparity.asp

another one of those "textbook" terms dismissed by boorish Nigerian know-it-alls (none of whom have ever read any of the textbooks they dismiss), but which every professional FX trader learns before stepping on a trading floor.

JimD:
Obi is wrong here. This was a long overdue step. But there should be a set target. After that target is met, they can gradually ease rates. There should be a revision of tax rates also and streamlined or digital taxation for the working populace. This in combination with reduced cost of governance, improved security and more mechanized farming will get the job done

Actually, there is such a target, but in my opinion it is still far too high - Cardoso is aiming for a 21.4% inflation rate.

https://www.reuters.com/world/africa/nigeria-central-bank-targets-inflation-decline-214-governor-2024-01-24/

A much more reasonable number would be in the 3-5% range, and to make this target more credible, the CBN charter could be amended to set this as its primary goal, which must be achieved over a fixed time range.

https://www.imf.org/external/pubs/ft/fandd/basics/72-inflation-targeting.htm

omohayek:

Actually, there is such a target, but in my opinion it is still far too high - Cardoso is aiming for a 21.4% inflation rate.

https://www.reuters.com/world/africa/nigeria-central-bank-targets-inflation-decline-214-governor-2024-01-24/

A much more reasonable number would be in the 3-5% range, and to make this target more credible, the CBN charter could be amended to set this as its primary goal, which must be achieved over a fixed time range.

https://www.imf.org/external/pubs/ft/fandd/basics/72-inflation-targeting.htm

Inflation rate in Nigeria has always averaged 13%. Africa's average inflation rate is about 9.8%. We can pick textbook policies but we must make them fit our own situation. https://www.focus-economics.com/country-indicator/nigeria/inflation/#

But 20+ is too high for a target. I would expect they bring inflation down to 13-15% and then start easing rates

WhiteWood:
Lol, Obi will always be a boy but I think he's right about this, because increasing the monetary policy rate and cash reserve ratio can cause job losses in sectors that depend on bank loans and credit. Just sticking to traditional economic theories will not be enough to handle Nigeria's current complicated economic problems. All I want is progress for Nigeria --Kudos Obi

Peter Obi is wrong and right.

He is wrong to say that increasing the interest rate to 22.5 % will worsen the economic situation because the the best way to fight growing inflation is to increase the interest rate.

He is right that unless Nigeria addresses the ongoing insecurity, there will be no food production, and inflation will continue in the background.

Increasing the interest rate is a short-term solution, but addressing the insecurity problem is the long-term solution to Nigeria's problem.

Nigeria requires trained state and local government police across all states and local government.

The most critical way to manage our high rate of inflation and decline in production is for the government to address the issue of insecurity in the country, which will allow for increased food, and crude oil production, and an overall increase in production,

omohayek:

Usually Obi sticks to nice-sounding but empty generalities, which makes it hard for listeners to make meaningful assessments of his supposedly "constructive" suggestions. Today, for once Obi does have something concrete to say, and all it ends up revealing is that he has nothing upstairs!

Wanting interest rates to remain below the level of inflation while endlessly complaining about a weak Naira is nonsense of the highest order. Anyone who can entertain such foolishness has never heard of "interest rate parity"

https://www.investopedia.com/terms/i/interestrateparity.asp

another one of those "textbook" terms dismissed by boorish Nigerian know-it-alls (none of whom have ever read any of the textbooks they dismiss), but which every professional FX trader learns before stepping on a trading floor.

Where's the trading floor for FX located?

IgbosCriminals:
Omo,

This social media influencer again.

Na statistics we go chop?

If to say this man Neva govern small state before, one would have thought he is a different politician.

Keep the advice you got from a mad man to yourself

which of your apc governor can match his record,you guys will just be repeating the same jargon that cannot stand the scrutiny of fact

CountinBlessins:
I have to side with PO on this!!! I have often wondered why Tinubu is not taking any original steps?!! why keep recycling old policies that older administrations either tried and didnt work or announced and never tried? what excatly is the problem?

Why not come out be bold and tackle head on those sabotaging the economy either through terrorism like bokoharam and iswap aka bandits or the currency sabotuers? wht is he afraid of? Why is he hesistant to do the needful? what do they have on him that is making him sit and watch the economy erode to this extent? at this rate tinubu may not do 4 years complete even

Do you even understand what inflation means

allthingsgood:


Do you even understand what inflation means

Do you even know why you need an education?

IgbosCriminals:
Omo,

This social media influencer again.

Na statistics we go chop?

If to say this man Neva govern small state before, one would have thought he is a different politician.

Keep the advice you got from a mad man to yourself

People like you with empty brains do not understand Economics. Show me one person in your lineage who is better than Obi.

If I were you, I would pray to learn and advance in life or hide your face in shame and remain stagnant for life.

You are just a daft with an empty brain. .

He is spot on. US increase interest rate from 2% to almost 6% and millions of jobs was lost. When interest was in 2's, I had to give away jobs cos I can handle it all. When interest rate jump to 5's, jobs trickle and tech industry was the first to cave. Between Facebook, Google , Twitter and Microsoft, over 500k people was let go.
Interest should be up incremental and not just a sudden jump. In a year time, most manufacturers will have to close shop for real.

WhiteWood:
Lol, Obi will always be a boy but I think he's right about this, because increasing the monetary policy rate and cash reserve ratio can cause job losses in sectors that depend on bank loans and credit. Just sticking to traditional economic theories will not be enough to handle Nigeria's current complicated economic problems. All I want is progress for Nigeria --Kudos Obi

Very disappointingly ignorant comments from Peter Obi. Maybe he wants to oppose everything the government does for the sake of it.

Expansionary monetary policy including rapid increases in the money supply and negative real rates (the difference between inflation rate and MPR) is one of the main drivers of inflation and currency depreciation in Nigeria.

CountinBlessins:
I have to side with PO on this!!! I have often wondered why Tinubu is not taking any original steps?!! why keep recycling old policies that older administrations either tried and didnt work or announced and never tried? what excatly is the problem?

Why not come out be bold and tackle head on those sabotaging the economy either through terrorism like bokoharam and iswap aka bandits or the currency sabotuers? wht is he afraid of? Why is he hesistant to do the needful? what do they have on him that is making him sit and watch the economy erode to this extent? at this rate tinubu may not do 4 years complete even

I totally agree with you. There are reasons why the previous administration never implemented those policies. I think Mr. President should think about it and devise new ideas and tackle the pressing issues you mentioned.

LadyExcellency:
Can we digest the content of Obi's criticism and submissions and leave his political differences? Nigeria needs all working suggestions.

The criticism provided by Peter Obi raises valid concerns about the potential negative impacts of the government's decision to increase interest rates in Nigeria. While the points made by Peter Obi about the possible consequences of job losses, credit availability for the real sector, and the overall economy are worth considering, there are a few aspects that can be further explored or countered:

1. **Transmission Mechanism of Monetary Policy**:
- Peter Obi focuses on the potential negative impacts of tightening monetary policy on the real sector. However, it's essential to acknowledge that the Central Bank of Nigeria (CBN) adjusts interest rates to control inflation, stabilize the currency, and foster economic growth. By raising interest rates, the CBN aims to reduce inflationary pressures and maintain price stability. While higher rates may make borrowing more expensive, they can also help in curbing inflation and attracting foreign investments, which are crucial for long-term economic stability.

2. **Inflation Control and Economic Stability**:
- Inflation in Nigeria has been a persistent challenge, and by increasing interest rates, the CBN is signalling its commitment to tackling this issue. High inflation erodes purchasing power, distorts resource allocation, and reduces economic efficiency. By implementing appropriate monetary policy measures, the CBN aims to create a stable economic environment conducive to sustainable growth.

3. **Addressing Root Causes of Inflation**:
- While Peter Obi points out that addressing insecurity and boosting production is vital for reducing inflation and enhancing economic growth, it's crucial to recognize that multiple factors contribute to inflation. Insecurity is undoubtedly a significant concern, but monetary policy, including interest rate adjustments, is a tool that can complement broader efforts to address structural issues in the economy.

4. **Balancing Short-Term Pain with Long-Term Gain**:
- While a hike in interest rates may have short-term adverse effects on businesses and borrowers, it is essential to consider the long-term benefits of price stability and sustainable economic growth. A well-implemented monetary policy can help create an environment that fosters investment, enhances productivity, and attracts both domestic and foreign capital.

In conclusion, while the critique by Peter Obi raises valid concerns about the potential impacts of the interest rate hike by CBN, it is crucial to view monetary policy decisions within the broader context of economic stability and long-term growth. Instead of dismissing traditional economic theories outright, a nuanced approach that considers both short-term challenges and long-term benefits can lead to more effective policy recommendations and outcomes.

Why does this look like a ChatGPT response?

jmoore:

There are many types of inflation. Ours is cost push inflation which is caused by fuel subsidy removal, high cost of dollars which makes cost of production to rise.
How would an increase in interest rate reduce the price of petrol and diesel?

Because it will cut the too much naira in circulation used to chase FX and weaken it in the process.
No be prick them dey use buy dollars,na naira.
Curb it's spread(by hiking interest rates),you control "market forces".
Another means is to increase taxes and VAT.
Too much naira in the hands of the everyday Nigerian,that has to stop!

No it won't. This is basic economics..

Central banks all over the world increase interest rate to curb inflation.

Exactly

SeaTrade:
Because it will cut the too much naira in circulation used to chase FX and weaken it in the process.
No be prick them dey use buy dollars,na naira.
Curb it's spread(by hiking interest rates),you control "market forces".
Another means is to increase taxes and VAT.
Too much naira in the hands of the everyday Nigerian,that has to stop!

All you have said will make petrol and diesel price to drop?

Ogiame:
The clown called Cardoso and his master does not have anything upstairs.



God will continually bless you your Excellency.

You that something is in your upstairs, what are you doing with it?

let the economy erode more and more so we can easily help our people back home with small amount of dollar or pounds and they will be swimming in million naira

CountinBlessins:
I have to side with PO on this!!! I have often wondered why Tinubu is not taking any original steps?!! why keep recycling old policies that older administrations either tried and didnt work or announced and never tried? what excatly is the problem?

Why not come out be bold and tackle head on those sabotaging the economy either through terrorism like bokoharam and iswap aka bandits or the currency sabotuers? wht is he afraid of? Why is he hesistant to do the needful? what do they have on him that is making him sit and watch the economy erode to this extent? at this rate tinubu may not do 4 years complete even

sadiest people from one region are wailing already, Obi is their nightmare sadiest people from one region are wailing already, Obi is their nightmare ...

Pjoe238:
let the economy erode more and more so we can easily help our people back home with small amount of dollar or pounds and they will be swimming in million naira

Kai all these illiterates sef
when they said go to school una no gree now see how you have shown the world your stupidity. Millions on naira without value? you are just an illiteratwe who doesnt understand basic economics .

Go to the jokes section pls

SeaTrade:
Because it will cut the too much naira in circulation used to chase FX and weaken it in the process.
No be prick them dey use buy dollars,na naira.
Curb it's spread(by hiking interest rates),you control "market forces".
Another means is to increase taxes and VAT.
Too much naira in the hands of the everyday Nigerian,that has to stop!

I agree with the.decision but your analysis is wrong
There is not too much Naira in the hands of ordinary Nigerians otherwise they won't be starving and ordinary Nigerians do not have access to credit anyway

This is actually targeting the rich trying to convince them to SAVE their wealth in Nairawith the idea that interest rates will counter value losses from inflation
If they save in Naira that will reduce dollar demand. That is the theory and hope.
To encourage saving N.A. WHO BELLEFUL DEY SAVE

However at that level it will definitely hurt the economy. And I see it as a short term measure
Tinubu himself is on record during the campaign as calling for low rates
That will only happen If we are.able.to build up foreign reserves and increase production
No one can produce at 22.5% and why should they? It is less risky to just put the money in the bank

olajumobi34k:
sadiest people from one region are wailing already, Obi is their nightmare sadiest people from one region are wailing already, Obi is their nightmare ...

Empty Barrel nightmare indeed from Agulu Republic?

E for go join them committee members for the meeting, instead of been at home watching it on channelstv?

Dera1000:


Tackling insecurity in the country and providing the farmers with aid will improve food production, and inflation and hunger will reduce.. CBN rule can still wait let's tackle insecurity first, that is our major problem now, all hands must be on deck let's move the country forward.

CBN is not set up to tackle insecurity. 🙄. They have a mandate and that's monetary policy mandate. Nigerians irk me so much. They all have solutions. This is how it's works everywhere.

AmuDimpka:
you must be a yoruba man..so Emefiele is the president to order printing of.money

You must be a Ronuist

You are idi.0t . Central Banks worldwide are independent. Illiterate. They act independent of the head of state.

Izuchukwu70:


You are idi.0t . Central Banks worldwide are independent. Illiterate. They act independent of the head of state.

you must be a Yoruba man....Na una Dey curse wella

What is Obi even saying, increasing interest rate will not make the economy worst, rather it will stabilise it