CBN Says Nigeria’s Economy Experiencing Stagnation, Inflation | Independent Newspapers Limited
Newsletter subscribe

Latest News

CBN Says Nigeria’s Economy Experiencing Stagnation, Inflation

CBN Resists Political Pressure, Retains Rates
Posted: Jul 19, 2016 at 9:17 pm   /   by   /   comments (0)


Godwin Emefiele, Governor of Central Bank of Nigeria (CBN) said on Tuesday that Nigeria is experiencing economic stagnation at the same time with inflation, a situation which he said does not portend well for the country

The CBN governor, who stated this when he appeared before the Senate, said it was frightening that the nation was experiencing economic stagnation at the same time with inflation, just as he was said to have stressed that ordinarily, stagnation and inflation should not happen at the same time, adding that the economy was gloomy, stagnant and worsening.

He told the Senate the true state of the nation’s economy in the last one-year and measures that were being taken by the Federal Government to remedy the situation.

At the meeting that lasted for an hour, the CBN governor began his presentation with current global economic conditions, which he said has been characterised by external shocks including the sharp decline in commodity prices, the geopoliticai tensions along important global trading routes, and tightening of monetary policy in the United States.

After the executive session with the CBN boss, Senate President Bukola Saraki said, “The Senate in a closed door session with the CBN Governor deliberated on the new foreign exchange, management policy and the determination of foreign exchange market by demand and supply mechanism.

He spoke on the need to continue to grow the economy and focus on diversification of the economy and also as regards the issues of some of the commercial banks.

In a statement shortly after the meeting by the leadership of the Senate, the CBN governor was said to have drawn Iinkages of some foreign occurrences with the Nigerian economy, especially with respect to the over 70 percent decline in oil prices from about S116 per barrel in June 2014 to about $30 per barrel earlier in the year.

According to the statement, “The Governor’s presentation also gave the Senators insight into the bank’s decisions in the Foreign Exchange Market, and the rationale underlying the recent re-introduction of a Flexible Exchange Rate Mechanism in Nigeria.

He also delved into the health of the financial system and discussed the Bank’s detailed examinations of financial institutions as well as its zero tolerance for insider dealings by Board and Management of deposit money banks.

In sum, the Governor declared that the Strategic health of Nigeria’s financial system is still strong at this time.