MPC’s Decision Will Not Affect Nigeria’s Monetary Policy – Economist

biz morningThe Monetary Policy Committee (MPC) of the Central Bank of Nigeria has been meeting for two days now and investors are anticipating the outcome of the meeting.

An Economist, Gabriel Idahosa, says that policies that were in place before the suspension of the CBN Governor, Lamido Sanusi would still be the same, adding that there would be no dramatic change after the decisions of the MPC.

Mr. Idahosa mentioned that the earlier speculations that there would be an increase of public sector deposit from 75% to 100% and private sector deposit from 12% to 15% will further reduce credit capacity of banks, adding that the banks can only give credit deposit from the deposit they hold, but the CBN will move the public deposit from 75% to 100% due to the pressure on the foreign exchange.

He said the MPC may need to look at the private sector before making any increase “because we don’t want to dry up all sources of credit to the economy, if you want the economy to grow you will have to provide some credit facilities to the economy” he added.

He further advised that the private sector deposit should form the bulk of credit resources for the bank

Excess Crude Account: FG opts for out of court settlement

The National Economic Council says it will within two weeks come up with a solution on how to settle the excess crude account litigation involving the federal government and the 36 state governors out of court.

The Supreme Court has given them up to 2nd September, to reach the out of court settlement over the issue or it will continue with the trials on the matter.

Briefing State House correspondents after the meeting, the Central Bank Governor, Mallam Sanusi Lamido Sanusi said that the decision to settle out of court is following the report by the sub-committee it set up to fashion out the modalities.

The economic council also said, henceforth, all state governments must defend their projects before the National Assembly before approvals for funding by (international donor agencies) for the execution of such projects can be approved.

The council asked state governments to also set up institutions that will enable them respond to emergencies and disasters anytime they happen without having to wait for the National Emergency Management Agency (NEMA).