CBN Governor
CBN Governor

Governor of Central Bank of Nigeria, CBN Godwin Emefiele has revealed that the country’s monetary policy rate would still have to go up given rising inflation rates.
He spoke weekend at the International Monetary Fund headquarters in Washington just as a director of the apex bank revealed that Nigeria would have been at the mercy of the International Monetary Fund, IMF, if the governor had not acted on time.
“Truly, Nigerians really expect that if they want to access finance, they should do so under a low interest regime,” Emefiele said.
“But of course you will agree with me that with the increase in inflation rate, from about 11.38 (percent) it was in February to almost about 12.8 in march, naturally what you find is that interest rate would have to still go up sort off.
“When you have the MPR below inflation rate, it is not a model that is acceptable.”
Higher interest rate is expected to discourage lending, but Emefiele has assured Nigerians that the CBN under his leadership will continue to do all it can to ensure that the sectors of the economy that grow the domestic industry get needed interventions.
“At the level of the CBN, we would continue, as much as possible to see how we can continue to increase our interventions to certain targeted areas of the economy,” he said.
“Particularly agriculture, mining, the real sector, areas that would boost domestic production, areas that would help to support our push away from relying on oil.
“Where we are seeing goods that can be produced in the country, where we find investors that are investing in domestic production rather than following up on exports, then we would continue to give that kind of investors support.”
In November 2015, the CBN cut interest rates from 13 percent to 11 percent – for the first time in six years – in order to free up some money for economic growth.
In March, the bank raised the rate to 12 percent, in anticipation of budget passage and flow of liquidity into the economy.
‘CBN saved us from IMF’
Speaking with online news medium, TheCable in Washington during the 2016 World Bank/ IMF spring meeting, the apex bank’s director of monetary policy committee (MPC), Moses Tule, expressed delight that Nigeria is free of IMF conditionality.
“I tell you, if Governor Emefiele had not taken these steps, the policies that the Central bank under his leadership took, by now, nothing would have stopped Nigeria from coming to IMF for a facility. Nothing!” he said.
“And of course, IMF facility comes with all the conditionalities, and if you don’t apply them to the fullest, you’re not going to get the facility.
“But, here we are still having sizeable reserves, just because of that decision. Look, we’ve got to take our destiny in our hands.”
Tule urged Nigerians to understand the realities of the economy, assuring them that the CBN is not out to kill any business, but to build a solid economy.
“It is because the Central Bank and the government said, we do not want to go to the IMF. We don’t want to go and ask anybody for resources. Let us manage what we have.
“It is only when we cannot achieve our goals that we can seek assistance. That is why we are still having what we are having.
“So, the important thing is, Nigerians need to understand that nobody is out there to kill their business, and that we must cooperate with government because only then can you build a solid economy that you can call your own. That’s the key message.”
Tule explained the reality of the Nigerian economy, round tripping, and why CBN can no longer give foreign exchange for education outside the country.

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