Expert urges CBN to curb inflation rates

As the Central Bank of Nigeria (CBN) opens its Monetary Policy Committee (MPC) meeting on Monday, a financial expert, Mr Okechukwu Unegbu, has advised the committee to address rising inflationary rates.

Unegbu, who gave the advice in an interview with the News Agency of Nigeria (NAN) on Monday in Abuja, noted that other relevant rates remained stable and could be maintained.

At the last MPC meeting held in November 2020, key policy decisions reached include the benchmark interest rate which was held at 11 per cent.

Others include Cash Reserve Ratio at 27.50 per cent and Liquidity Ratio retained at 30.00 per cent.

“I guess that the MPC will leave the rates as they are because there appears to be some stability. The only issue is that inflation is going up, and it means that our currency is becoming weaker. What to do is to reduce the quantum of money in circulation,’’ he said.

He advised that the reserve requirement and liquidity ratio be adjusted to stabilise the economy.

NAN reports that Monday’s MPC meeting will be the first in 2021.

The MPC is the highest policy-making committee of the CBN with the mandate to: Review economic and financial conditions in the economy and Determine the appropriate stance of policy in the short to medium term

Other mandates are to Review regularly, the CBN monetary policy framework and adopt changes when necessary, communicate monetary/financial policy decisions effectively to the public, and ensure the credibility of the model of the transmission mechanism of monetary policy.