The experts gave the advice in separate interviews with News Agency of Nigeria (NAN), in Lagos ahead of the MPC meeting, scheduled for May 28.

They said that the the pandemic coupled with the sudden collapse of the oil market, which at the moment appeared to be showing early signs of recovery, meant that the only option confronting the country was to offer stimulus packages.

Dr Boniface Chizea, the Managing Director of BIC Consulting Services, urged the committee to maintain status quo.

“So, this is not the time to be tinkering with interest rates as it is of no effect or Cash Reserve Ratio or Loan to Deposit Ratio.

“The MPC meeting may just offer some advice to the Executive management of CBN, rectifying what has been done so far.

“We read that the reserves are bleeding profusely as the CBN defends the rate of exchange,  recalling that the rates were suddenly reduced by 18% to 360.

“But since not much of activity is going on by way of imports, scant attention has been paid to developments in this regard.

“So, we are in a global crisis and, realistically,  we expect a bold decision,” Chizea said.

In the same vein, a Political Economist, Chief Martin Onovo, urged the Committee to lower interest rates.

“As it is today, Inflation is rising, our foreign reserve is dropping very sharply.

“National debt has also risen sharply and our country is clearly in a debt trap and heading to a debt crisis.

“In addition, the Naira is loosing value sharply and the national economy is clearly ruined.

“Based on these, we expect the CBN in line with the stimulus package, to lower the interest rate.

“But, this will have an almost insignificant effect,  given the current national economic predicament,” Onovo said.

However, Prof. Ndubisi Nwokoma, Director, Centre for Economic Policy Analysis and Research (CEPAR) University of Lagos, advised the committee not to lower the Monetary Policy Rate (MPR).

The MPR is an interest rate at which CBN lends to commercial banks and other clients.

He said: “The exchange rate is fragile with possibility of further depreciation of the naira.

“Oil revenue is dwindling and foreign reserves on the decline.

“Inflation is on the increase and incomes are not rising for households.

“In view of this, I think CBN should not relax credit through the Deposit Money Banks (DMOs).

“Loosening credit through DMBs can lead to more pressure on the exchange rate and hence, further depreciation of the naira. Hence MPR should not be lowered,” Nwokoma said.

However, he advised that more focus should be on developing finance credit to stimulate the sectors through Small Medium Enterprises (SMEs).

He added that the SMEs had been the hardest hit by the lockdown, the border closure and the macroeconomic uncertainties.

NAN recalls  that the MPC in March,  retained all key policy rates amid the growing impact of COVID-19 on the global and Nigerian economy.

MPR or the controlling lending rate was left at 13.5 per cent, with the asymmetric corridor at +200/-500 basis points around the MPR.

The Liquidity Ratio was at  30 per cent, while Cash Reserve Requirement (CRR) was left unchanged at 27.5 per cent.(NAN)