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The Governor of Central Bank,Godwin Emefiele appealed to bandits terrorizing the country to leave the bushes, drop their weapons and take advantage of the bank’s anchor borrower programme.
Addressing journalists at the end of the 2-day meeting of the Monetary Policy Committee (MPC) meeting in Abuja, Mr Emefiele said the programme is more rewarding and would add value to their lives and the country
He maintained that there is a correlation between the growing insecurity and poverty in the land.
He said the bankretained its monetary policy rate at 11.5 per cent, with the asymmetric corridor of +100/-700 basis points around the MPR and also retained other parameters.
He said the committee also voted to retain the Cash Reserve Ratio (CRR) at 27.5 per cent as well as the Liquidity Ratio at 30 per cent,adding that the move is expected to allow further economic growth, despite four-year high inflation, after the country exited recession last year.
“In summary, MPC voted as follows, one, retain MPR at 11 per cent; retain the asymmetric corridor of +100/-700 basis points around the MPR; retain the CRR at 27.5 per cent; retain the Liquidity Ratio at 30 per cent.”
He however, noted that MPC is of the view that although economy has exited recession, the recovery was still very fragile, given that of 0.51 per cent was still far below population growth rate.
He said the committee believed a hold decision was the optimal decision adding that maintaining the status quo will enable previous policy actions to permeate the economy while keeping an eye on global and domestic developments.
The committee acknowledged that while such a policy action will help address the stubbornly high Inflation, it will constrain the flow of credit to the private sector and upset the economy’s fragile recovery.
On loosening, the committee expressed that although this will complement the government’s efforts in restoring the productive capacity of the economy, it will make it more difficult for the apex bank to achieve its core mandate of price stability.
On the latest Gross Domestic Product data, the committee expressed that the recovery remains fragile given that the GDP growth of 0.51 per cent is still far below the average population growth rate of 2.7 per cent. The Committee also expressed confidence that the economy will remain on growth pedestal over the rest of the year.
The committee noted the moderate decline in headline inflation to 18.12 per cent from 18.17 per cent in March, driven by a marginal slowdown in food inflation, as it attributed the slowdown in food inflation to the CBN’s major interventions to the various sectors of the economy to stimulate aggregate demand and boost production, particularly to the MSMEs.
Meanwhile, the Central Bank of Nigeria (CBN) has officially adopted the Nigeria Autonomous Foreign Exchange (NAFEX) rate, devaluing the naira to N410 to the dollar even as the value of the naira depreciated to N486 at the parallel market.
The CBN had earlier this month removed the N380 per dollar exchange rate from its website spurring rumors of a pending devaluation.
The apex bank,on its website, it put the NAFEX rate, which is also known as the Investors’ and Exporters Window (I&E) at N410.25.
On the FMDQ website, the NAFEX closing rate was N411.25 to the dollar, whilst at the parallel market, the value of the naira had depreciated to N486 from N484 to the dollar which it began the week with.
Emefiele also confirmed that the change in the official exchange rate to the NAFEX rate was necessitated by the fact that government transactions were no longer consummated using the official exchange rate but rather benchmarked against the NAFEX rate reiterating that Nigeria still operates a managed-float exchange rate regime.
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