Due to its new monetary policy drive the Central Bank of Nigeria, CBN, may be pulling out up to N1.0 trillion from circulation in the economy through the banking system in the first month of its new monetary policy.
Already N525 billion has been pulled out less than one week after the policy which seeks to tighten money supply, while additional N219 billion is slated to be pulled out next week, just as banks’ treasury executives said they were preparing their treasury plans for more mop ups estimated to be up to N300 billion within the next three weeks.
The apex bank had last week announced a reversal of its expansionary monetary policy which it had run for eight months, in favour of contractionary measures under which the Monetary Policy Rate, MPR, was increased to 12 per cent from 11 per cent while Cash Reserve Requirement, CRR, was hiked to 22.5 per cent from 20 per cent.
Both rate increases would effectively increase interest rates, cost of funds and yields on money market instruments floated by the apex bank while transferring huge cash from the banking system into the government vault.
Of the N525 billion already pulled out, about N410 billion was quarantined in relation to the new CRR, while N115 billion was pulled out into Nigerian Treasury Bills, NTB, and with another N219 billion slated for mop up next week in NTB, the apex bank would have taken out a total of N744 billion by end of next week.
http://www.vanguardngr.com/2016/03/new-monetary-policy-pulls-n744bn-circulation/

lalasticala obinoscopy mynd44

Haba dem wan send me back to the creeks?
FTC dedicated to ANAMBRARIANS and MAN UTD fans only

Make I no form wetin I no know.



How does this affect Nigerians on the street? Someone should please try and explain.

Today is my birthday

A government at war with itself, CBN monetary Policy is mopping up liquidity, finance ministry's fiscal policy, stimulate the economy by implementing an expansionist budget and pumping in money into the system. These guys are at a tug of war with them selves pulling the economy apart at opposite ends. Now finance ministry is putting 350 billion into the economy and CBN is mopping up almost 1 trillion so what is the net result?

Nigerians better get on your knees to pray because the shit is getting "realer"

This policy is counter productive. The reason for high inflation in Nigeria is basically due to very short supply of goods due to the forex prohibition and not from high circulation of money; retracting money from the economy will make people even more poorer and unable to buy goods which in turn will kill businesses, factories and establishments which relies on these people to sell their products.

the whole story...ah dont even know


can someone pls explain beta

is it affecting the price of recharge card?

Abeg, what is d effect of this policy on d economy?

I was asking what's the need for stashing up trillions in the CBN vault without injecting it into the economy especially at such a hard time. Expansionary Fiscal and Monetary policy is always recommended in economic situations like this. But no time is too late shaa!

kossyablaze:
Haba dem wan send me back to the creeks?

u mean creek road?

I suspect CBN wants to reduce inflation somehow...by mopping up excess.(Flawed thinking...but yeah).

Also, the government is out of cash. Because oil money is not flowing in....the government has to take this measure to balance the books...and hope that we do not go broke later. In other words...they are saving the cash.

In my opinion, good. Either oil goes up to 123 dollars per barrel....or nothing. We have to save cash anyhow.

I just dey see Billions, Billions, Billions!




Space for sale: who is interested?

OK. What is the implication of that?
Is it a good thing?

ok

the problem for the country don try wrapper, come Wear face cap join

people have being groaning under serious financial hardship and the best thing the government thought of doing is to tighten the nozzle around the neck of Nigerians.

this na wetin fela call double wahala for deadi body!

brace up zombies n wailers, the sh*t is about to get really nasty!

What's the meaning of diz- it's inhumane and foolish.

You are withdrawing money from common man nd stashing it up when prices of goods are increasing everyday.

Why don't u solve d inflation b4 making d naira strong.

What is d need of a strong naira with poor citizens.

Imagine ghana, with their strong currency have to devalue to make life easy.



This gov't tink when dey sax piple are suffering, it's a joke.

Worst president EVER, twice.

Generally speaking contractionary monetary policies and expansionary monetary policies involve changing the level of the money supply in a country. Expansionary monetary policy is simply a policy which expands (increases) the supply of money, whereas contractionary monetary policy contracts (decreases) the supply of a country's currency.

- Contractionary monetary policy causes a decrease in bond prices and an increase in interest rates.
- Higher interest rates lead to lower levels of capital investment.
- The higher interest rates make domestic bonds more attractive, so the demand for domestic bonds rises and the demand for foreign bonds falls.

Further read on this page
http://economics.about.com/cs/money/a/policy_2.htm

Na wa o

More trouble ahead Baba regime hmmm

Make una See me See wahalaoooo,
I went for the burial of a friends grand dad somewhere in Kogi, & in that village, when someone dies, an elderly man will come up and tell whose next to die. So this man came along and said that the next person whose going to die, is the one who decides to leave the burial ground first. My people, since last week I stil dey dia o. nobody wan 1st go oo, everybody just lie down, Even the old man at age 112 years is lying down beside me,is asking me if my people go never start to look for me?
As am talking to u now. Am still lying down What should I do next?

Kai these policies dem em.



Anyway it's not nice around here.





ThefakeStan

Time to buy treasury bills

Any idea what the Treasury rate is at the level of commercial banking?

All these just to suffer d poor masses. But Buhari will see the money he will use to be travelling up and down even for irrelevant meetings.

I don't trust this government anymore, on a rainy day they could probably dip their hands into the same vault and spend our hard earned money.


Like tax for sms, mms and calls isn't enough.

Hmmm pulling out monies from circulation when nigerians arnt even seeing the monies to spend. I wonder what economic team we have in this country.

dey want us to die of hunger ni?

What other thing or sign are we expecting to believe that ur president is clueless and dull?

CBN "pulled out" 744 billion naira!?!



That's gotta be the world most expensive sex, man.

In english please

CBN choosing stability over growth.

Good oh, but long run implication dey sha.