.
It also reduced the Cash Reserves Requirements for Banks from 31 per cent to 25 per cent as well as retained the Monetary Policy Rate at 13 per cent.
The committee also retained the symmetric corridor of 200 basis points around the MPR; and left the Liquidity Ratio unchanged at 30 per cent.
Addressing journalists shortly after the two-day meeting of the committee held at the CBN headquarters in Abuja, the CBN Governor, Mr Godwin Emefiele, noted that the economy had remained fragile owing to various factors.
For instance, he said the country's Gross Domestic Product Growth Rate recorded a slow growth in the second quarter of this year, making it the second consecutive less-than-expected performance for the current fiscal year.
According to the National Bureau of Statistics, real GDP grew by 2.35 per cent in the second quarter of 2015, a significant decrease when compared with the 3.96 per cent and 6.54 per cent in the preceding quarter and corresponding period of 2014, respectively.
Real GDP growth is projected by the NBS to stabilise at 2.63 per cent in 2015, compared with the 6.22 per cent recorded in 2014.
The committee, according to the governor, however, noted that the impact of non-payment of salaries at the state and local government levels had led to reduction on consumer demand.
He said while year-on-year headline inflation continued to trend upwards, demand pressure in the foreign exchange market remained significant as oil prices continued to decline.
As a result of these developments, Emefiele said there were indications that some of the banking sector performance indicators could be stressed if these conditions worsen further.
Specifically, he expressed worry that liquidity withdrawals following the implementation of the Treasury Single Account, elongation of the tenure of state governments loans as well as loans to the oil and gas sectors could aggravate liquidity conditions in banks and impair their financial intermediation role.
These, he noted, could affect economic growth, unless some actions were immediately taken to ease liquidity conditions in the markets.
He said, "The committee noted that the overall macroeconomic environment remained fragile.
"The committee noted that liquidity withdrawals following the implementation of the TSA, elongation of the tenure of state government loans as well as loans to the oil and gas sectors could aggravate liquidity conditions in banks and impair their financial intermediation role, thus affecting economic growth, unless some actions were immediately taken to ease liquidity conditions in the markets.
"Having seen two consecutive quarters of slow growth, the committee recognized that the economy could slip into recession in 2016 if proactive steps were not taken to revive growth in key sectors of the economy."
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Surprised that there's no comment by the "APC-performing" supporters. We can now see the truth. When GEJ and his team were performing, we said he was corrupt, and chose a self-made saint for a redeemer. Only four months into his reign, clouds of despair are already beginning to gather over the country. CBN report is known to be objective and factual. No playing politics here. Is this the promised Change? Is it a change from the largest economy in Africa to one in recession? Take a honorable bow please.. GEJ, Adesina, Oteh, and Okonjo-Iweala. You are true heroes. We now know who is clueless.
ReplyDeleteBros just listen to yourself. Did you read the statement credited to the CBN Governor? Your write up appears biased. When did non payment of salaries start? Is it when Buhari had come to power? Sometimes we make blind and deceitful comments just because we do not like a particular person. Remember also that the economy started going down years back. Please eschew bias in your comments and try to understand what you have read.
DeleteIf you had said this after 6 to 12months of this new administration then it could be understood....but remember just because you change a bad teacher of 6 years whom had taught rubish to his students replace him with a good one doesn't mean all the rubish the students have learnt for 6yrs would be erased or corrected in 4 months. #justpassingby
ReplyDeleteWhy won't the economy be fragile where ee do not have economic management team for months now. There is no economic blue print, just noise making and media trial of alleged corrupt officials.
ReplyDeleteLai Muhammad will soon respond in defence of his party and the government, not telling Nigerians the truth.
Why won't the economy be fragile where ee do not have economic management team for months now. There is no economic blue print, just noise making and media trial of alleged corrupt officials.
ReplyDeleteLai Muhammad will soon respond in defence of his party and the government, not telling Nigerians the truth.
This new regime is just there fighting, they are still campaigning, talking about PDP everyday and forget to focus on administration. If they are overwhelmed with the power, they should just prepar to hand over to another party in 2019
ReplyDeleteThis is not the first time and ofcourse will not be the last . Since our megA unit of income is crude oil anytime the price of crude nose dive we always faces economic turn down . Remember OFN 1976 Green revolution 198o belt ajdustment 1985 . Let just pray that our sources income be multiply and that God give us Good leader @ our point of economics reccession . Somebody shout Alleluyah
ReplyDeleteThere are facts to be deduced from the reports but my question is what are the recommendation to improve and enhance the economy? Let the Central Bank of Nigeria releases a blue print that will help grow the economy. We urgently need the recommendation so that Buhari's administration should take actions to implement the recommendation.
ReplyDelete