The Central Bank of Nigeria said it is paying less attention to policies that will trigger employment opportunities because of inflation.
The Acting Director, of the Banking Supervision Department of the CBN, Dr Adetona Adedeji, said this in the second episode of the CBN Talk podcast, published on its Youtube page, seen by THE WHISTLER.
“The ultimate objective is for us to combat inflation. That is exactly what the central bank is doing today. Whatever it takes to fight inflation, we are going to do that. It may have some impact in some area,” Adedeji said.
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The CBN is pursuing a hawkish monetary policy to combat inflation which the National Bureau of Statistics measured at 33.2 per cent in March.
The CBN hiked its monetary policy rate to 24.75 per cent and later slashed Loan to Deposit Ratio from 65 per cent to 50 per cent which is indicative of its stance to battle inflation.
However, experts believe that the move would restrict flow of money to the real sector which would effectively frustrate growth.
Adedeji maintained that the apex bank has a primary mandate of maintaining price stability.
“We can’t fight two things at the same time,” he said adding “There will be trade-offs.
“If you are fighting inflation, you can’t fight unemployment at the same time. Even if you fight unemployment, it cannot be up to the desired level. So, you have to choose either to fight inflation or you fight unemployment.
“They two are macro-economic objectives that are very critical to the development of the economy.”
He said prioritising growth and unemployment over inflation would be counter-productive.
“So, it is very important we concentrate and fight inflation. By the time we bring inflation down, we start talking of economic growth,” he added.