by Kingseyi Wed Jul 25, 2018 1:28 pmLagos – A financial expert, Dr Samuel Nzekwe,
says the retention of the Monetary Policy Rate
(MPR) at 14 per cent was expected and will
effectively monitor the consistent inflation rate
drop.
Mr. Godwin Emefiele, Governor, CBN; Dr.
Okwu Joseph Nnanna, Deputy Governor
(Financial System Stability), CBN; Mrs.
Aisha Ahmad, Deputy Governor, CBN;
Prof. AdeolaFestus Adenikinju, MPC
Member; and Mrs. Alice Karau, Ag.
Director, Corporate Secretariat, CBN; at
the CBN Head Office, Abuja, on
Wednesday, March 28, 2018, following the
assumption of duty of the new Deputy
Governors and MPC members.
Nzekwe, a former President of the
Association of National Accountants of
Nigeria (ANAN), expressed the view in an
interview on Wednesday in Lagos.
According to him, the retention of the MPR at 14
per cent is logical because there is still the need
to see if the consistent drop in inflation rate can
be sustained.
Monetary Policy Committee (MPC) of the Central
Bank of Nigeria (CBN) retained MPR at 14 per
cent for the 11th consecutive time.
The rate was first raised in July 2016 to combat
rising inflation. The MPR is the rate at which
banks anchor their lending rates.
Nzekwe said that the reduction in inflation rate
and retention of the MPR rate had provided a
situation whereby policy makers should look
inwards to ensure thriving of the production
sector.
“There is no need to be in a hurry to reduce the
Monetary Policy Rate. Inflation rate is coming
down, but it is as a result of the peace in the oil
market.
“If there is volatility in the oil sector, particularly
in terms of reduction in oil price, you will see
the effect on the economy.
“In real terms, we have not achieved that level
that requires the monetary policy rate to be
reduced.
“This is because if there is any change in the
production of oil, the impact will be felt on the
economy immediately; it is when we achieve
high production that external volatility will not
affect us.
He suggested that the Federal Government
should focus attention on improving
infrastructure for the production sector to thrive.
Nzekwe said that there should also be
continuous efforts to avert increase in food
prices.
The former ANAN boss hailed the CBN for its
plan to complement the efforts of commercial
banks through support mechanism to ensure
they would lend to corporate entities at a single
digit rate.
The Managing Director of the Cowry Assets
Management Ltd., Mr Johnson Chukwu, said that
the MPC prioritised its non-expansion policy
stance above real output growth consideration.
Chukwu said that the decision of MPC was
because the inflation rate remained well above
the target of six to nine per cent.
He expressed the hope that the MPR would help
to mitigate the reversal of capital outflows by
Foreign Portfolio Investors amidst monetary
policy normalisation abroad. (NAN)
says the retention of the Monetary Policy Rate
(MPR) at 14 per cent was expected and will
effectively monitor the consistent inflation rate
drop.
Mr. Godwin Emefiele, Governor, CBN; Dr.
Okwu Joseph Nnanna, Deputy Governor
(Financial System Stability), CBN; Mrs.
Aisha Ahmad, Deputy Governor, CBN;
Prof. AdeolaFestus Adenikinju, MPC
Member; and Mrs. Alice Karau, Ag.
Director, Corporate Secretariat, CBN; at
the CBN Head Office, Abuja, on
Wednesday, March 28, 2018, following the
assumption of duty of the new Deputy
Governors and MPC members.
Nzekwe, a former President of the
Association of National Accountants of
Nigeria (ANAN), expressed the view in an
interview on Wednesday in Lagos.
According to him, the retention of the MPR at 14
per cent is logical because there is still the need
to see if the consistent drop in inflation rate can
be sustained.
Monetary Policy Committee (MPC) of the Central
Bank of Nigeria (CBN) retained MPR at 14 per
cent for the 11th consecutive time.
The rate was first raised in July 2016 to combat
rising inflation. The MPR is the rate at which
banks anchor their lending rates.
Nzekwe said that the reduction in inflation rate
and retention of the MPR rate had provided a
situation whereby policy makers should look
inwards to ensure thriving of the production
sector.
“There is no need to be in a hurry to reduce the
Monetary Policy Rate. Inflation rate is coming
down, but it is as a result of the peace in the oil
market.
“If there is volatility in the oil sector, particularly
in terms of reduction in oil price, you will see
the effect on the economy.
“In real terms, we have not achieved that level
that requires the monetary policy rate to be
reduced.
“This is because if there is any change in the
production of oil, the impact will be felt on the
economy immediately; it is when we achieve
high production that external volatility will not
affect us.
He suggested that the Federal Government
should focus attention on improving
infrastructure for the production sector to thrive.
Nzekwe said that there should also be
continuous efforts to avert increase in food
prices.
The former ANAN boss hailed the CBN for its
plan to complement the efforts of commercial
banks through support mechanism to ensure
they would lend to corporate entities at a single
digit rate.
The Managing Director of the Cowry Assets
Management Ltd., Mr Johnson Chukwu, said that
the MPC prioritised its non-expansion policy
stance above real output growth consideration.
Chukwu said that the decision of MPC was
because the inflation rate remained well above
the target of six to nine per cent.
He expressed the hope that the MPR would help
to mitigate the reversal of capital outflows by
Foreign Portfolio Investors amidst monetary
policy normalisation abroad. (NAN)
