Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN), says the country is paying for the consequences of the N27 trillion ways and means loan.

On May 23, 2023, the senate approved the N22.7 trillion ways and means loan, thereby securitising the debt following a request by former President Muhammadu Buhari on December 28, 2022, asking the lawmakers to do so.

Speaking on Thursday at the BusinessDay CEO Forum, Cardoso said there was also a situation where money supply into the system was a lot.

He said the country is now bearing the burden of the loan.

“We all saw ways and means soar to N27 trillion and interventions went to N10.5 trillion. It has its consequences. In a large respect, that’s what we’re paying for now,” he said.

In May, the monetary policy committee (MPC) of the CBN raised interest rates from 24.75 percent to 26.25 percent.

According to the CBN governor, the MPC is not oblivious to the fact that the country requires economic growth.

“If these hikes were not done when they were done, if you recall naira to dollar was almost tipping over. This helped to stabilise things. It’s a timing issue,” he said.

“This is not something that I expect will remain with us forever. Fiscal issues being moderated and the ability to soak up the excess liquidity in the system and be able to balance things out over a period of time. That is important for the MPC.”

He said the MPC is focused on taming the inflation rate and stabilising the naira.

Cardoso said the monetary policy rate (MPR) is set by the MPC committee composed of independent-minded people — not the CBN governor.

“These are people not given to emotion but to data. The MPC clarified that the major issue is taming inflation, and they would do what is necessary to tame it,” he said.

Nigeria’s inflation rate is 33.95 percent, buoyed by surging food prices and high energy costs.

Speaking on the issue of foreign exchange (FX) volatility, Cardoso said the bank had to correct some dysfunctions in the financial system, such as illicit flows and those who did not abide by the rules, to ensure market stability.

“Sometimes, there’s pushback from those who want to continue doing things a certain way. There’s also that need to show people that there will be consistency in our ways before the market will settle,” he said.

The CBN governor noted that timely communication and market transparency have restored stakeholders’ confidence, adding that there is no more front-loading of FX requests.

“Even with portfolio investors, we found a good number of them came in, left and came in again,” Cardoso said.

“They were pretty comfortable that there was a plan and that the plan was headed in a direction that they could see, they understood and they trusted.

Cardoso said a lot of the wide swings witnessed in the foreign exchange market “are gradually beginning to smooth out as a result of a better understanding of the market, better transparency, and the comfort that those who are using the market see in it”.

BABANGBALI:
Rubbish! Is that why you were appointed? To make excuses?

Leemzyy:
Let me call my uncle 2 sack this werey

BABANGBALI:
who is your uncle?

thewarrior72:

Like thieffnubu like his appointees. Clueless and useless.... spits

thewarrior72:
God punish you, the eediot that appointed you and all his happy sla.ve supporters

Blazetrailer:
Lol....imagine what is coming from a supposed "intellectual" selected by a so called "strategist" to manage the monetary part of the country

Run ooo!!! Nigeria is in the hands of kalokalo economists

Get out while you can