ABCON boss urges CBN to mop up naira, cut interest rate

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A financial expert, Alhaji Aminu Gwadabe, has urged the Central Bank of Nigeria to further mop up excess Naira in circulation to sustain its stability.

The advice came ahead of the Monetary Policy Committee meeting of the bank scheduled for July 24 in Abuja.

Gwadabe, who is President, Association of Bureau De Change Operators of Nigeria, said on Friday in Lagos that a Naira mop would sustain its stability.

The CBN bi-monthly MPC meeting has been scheduled for July 24 and 25 in Abuja, headquarters of the apex bank.

According to Gwadabe, excess Naira liquidity in the economy is an easy tool at the disposal of currency speculators in manipulating the nation’s currency.

The ABCON boss said that a slight adjustment in the benchmark interest rate was required to boost the growth of Small and Medium Scale Enterprises in the country.

He appealed to the MPC to consider the harmonisation of rates in the foreign exchange market to forestall round tripping and speculation.

The CBN rose from its March MPC meeting, retaining the Monetary Policy Ratio (MPR) at 14 per cent, citing uncertain economic conditions and high inflation.

The apex bank has not made any monetary policy change since July 2016.

The apex bank also retained the Cash Reserve Ratio (CRR) at 22.5 per cent and the Liquidity Ratio at 30 per cent, while the asymmetric corridor was retained at ¬+ 200 and -500 basis points around the MPR.

With a steady decline in the nation’s inflation rate and a relative stability in the foreign exchange market, it remains to be seen if the MPC will adjust monetary policy parameters to reflect the present economic reality.

(NAN)

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