Don urges CBN to sustain monetary policy to further curb inflation

A Don, Dr Austine Nwaeze, has urged the apex bank to sustain its current monetary policy to curb the nation’s inflation rate.

Nwaeze, who teaches Economics at the Pan Atlantic University, Lekki, Lagos said this in an interview with the News Agency of Nigeria (NAN) in Lagos on Friday.

The lecturer, who was reacting to the inflation figures released by the National Bureau of Statistics (NBS) on Friday in Abuja, noted that a lower inflation rate would lead to price stability.

NAN reports that the Consumer Price Index (CPI) released by NBS showed that inflation decreased to 11.37 per cent (year-on-year) in January 2019 compared to 11.44 per cent in December 2018.

According to the CPI figures, urban inflation rate also decreased to 11.66 per cent (year-on-year) from 11.73 per cent December, while the rural inflation rate dropped to 11.11 per cent from 11.18 per cent in December.

However, core inflation, which excludes the prices of volatile agricultural produce stood at 9.9 per cent in January, representing an increase of 0.1 per cent compared with 9.8 per cent recorded in December.

Nwaeze said the apex bank’s continuous monitory intervention in the investment and export window had reduced the pressure on the country’s foreign exchange.

According to him, the sustained initiative has eliminated forex round-tripping and made foreign denominations available and close to convergent rate.

He said the inflation rate would have dipped further, if not for the spending caused by the 2019 general election.

“The inflation should have declined more than what is being released by the bureau, because of the tightening approach by the monitory authorities.

“The Monitory Policy Committee had kept the lending rate at 14 per cent for a long time, reducing the sum of funds in circulations and this has helped to curb inflation,” he said.

In November, the Governor of the Central Bank of Nigeria, Godwin Emefiele, said he expected the central bank to keep monetary policy tight in 2019.

Emefiele said the short-term outlook for the economy was good and that the country was open for foreign investors.

Credit: NAN