High Interest Rates Threaten Growth, Stakeholders Warn CBN

High interest rates remain a major concern for businesses, with stakeholders warning that persistently tight monetary policy could slow economic growth and limit access to credit.

President of the Enugu Chamber of Commerce, Industry, Mines and Agriculture, Nnanyelugo Onyemelukwe, said the Central Bank of Nigeria’s (CBN) reforms have strengthened transparency and rebuilt investor confidence, but borrowing costs remain high.

He urged the bank to gradually ease interest rates to support productivity, private sector growth, and indigenous businesses.

“High interest rates are constraining access to finance and could hamper economic expansion,” Onyemelukwe said. “While the CBN’s interventions have supported various sectors, sustained policy measures are needed to ease financial pressures without undermining monetary stability.”

The CBN, however, stressed that its current monetary stance is necessary to consolidate gains in price stability and safeguard the broader economy. The apex bank emphasized that balancing inflation control with sustainable growth remains a top priority.

At the 37th Enugu International Trade Fair, the CBN also renewed its warning against naira abuse. Acting Director of Corporate Communications and Investor Relations, Sidi Ali Hakama, urged Nigerians to handle the national currency responsibly, describing it as a symbol of sovereignty.

She highlighted efforts to promote a cleaner currency culture and reduce practices such as mutilation, spraying, hawking, and counterfeiting, which undermine the integrity of the financial system.

Hakama noted that maintaining clean and fit currency notes is essential for sustaining public confidence and supporting economic activities nationwide.

She added that the bank’s forward-looking, rules-based monetary policy framework is designed to guide market expectations and cushion the economy from external and supply-side shocks.

The CBN said its anti-inflation measures are delivering tangible results. Headline inflation, which peaked at 34.8 percent in late 2024, declined to 15.06 percent as of February 2026. Capital inflows rose nearly 200 percent between 2023 and 2025, while external reserves increased from below $10bn to over $50bn during the same period.

Looking ahead, the bank outlined priorities for 2026, including strengthening the banking sector, modernising payment systems, expanding financial inclusion, supporting MSMEs, and fostering responsible innovation in financial technology.

While stakeholders acknowledged the CBN’s progress, Onyemelukwe warned that without a gradual reduction in borrowing costs, high interest rates could stifle private sector growth.