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Multiple Interest Rate Hikes Have Helped To Restore Confidence In Naira — CBN Governor Cardoso 

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The governor of the Central Bank of Nigeria (CBN), Olayemi Cadoso, says the multiple interest rate hikes have restored confidence in the naira.

The consecutive interest rate hikes have encouraged people to see the currency differently, Cardoso stated.

The CBN governor made this known while speaking at a press conference on Tuesday after the monetary policy committee’s (MPC) 297th meeting in Abuja.

Since the resumption of the MPC meeting this year, the committee has increased the monetary policy rate (MPR), which benchmarks the interest rates, from 22.75 percent in February to 27.25 percent in September.

Cardoso said the monetary tightening has also helped to moderate inflation.

“There was a situation where exchange rate was really running at an incredible pace and people were beginning to lose confidence in the currency,” he said.

“We believe that these multiple hikes have helped for people to now begin to take a different look at their currency, and there is a greater incentive to hold naira as opposed to a situation that we had before where this was not the case.”

However, on June 12, the World Bank warned that the multiple interest rate hikes may not rein inflation and the failure of the monetary tightening poses a risk to economic growth.

Also, the Centre for the Promotion of Private Enterprise (CPPE) on Tuesday said the latest hike in interest rate by the CBN is detrimental to investment and economic growth.

Speaking further, Cardoso said the CBN has worked to make the foreign exchange market more flexible and transparent by clearing the backlog of $7 billion and improving transparency in its operations.

He said it has rebuilt confidence in Nigeria’s financial system.

On February 5, Cardoso said he inherited a $7 billion foreign exchange (FX) backlog when he became the head of the apex bank in September 2023, however, it has dropped to $2.2 billion.

A month later, the CBN announced that it had successfully settled all valid outstanding FX obligations.

  • ‘MONEY SUPPLY INCREASED BY N35TRN WITHIN 8 YEARS’

Cardoso said money supply increased by N35 trillion within eight years due to ways and means advances.

The CBN governor said between 2015 and 2023, the country’s money supply rose from N19 trillion to N54 trillion.

He said the increase was driven majorly by the printing of money through the ways and means mechanism, which led to an alarming rate of liquidity into the economy.

“We came into a very loose money supply situation. Between 2015 and 2023, the past eight years witnessed an incredible amount of pumping of liquidity into the system,” Cardoso said.

“In 2015, money supply was about N19 trillion and in 2023, it was N54 trillion. That is a huge increase, a very, very huge increase, and a substantial amount of that was through ways and means.

“Essentially printing of money resulted in a huge amount of money chasing because this is the implication. Chasing the same amount of goods, a relatively small amount of goods growing at 1.2 percent during that time and money supply was growing at 12.6 percent. You can see the inherent distortion there.”

The CBN governor said the situation worsened in 2015, when global oil prices collapsed, aggravating Nigeria’s economic challenges, given its heavy dependence on oil.

He said as a result of the collapse in oil prices, there was a decline in available FX, prompting authorities to fix exchange rates, which subsequently led to multiple exchange rates and opportunities for arbitrage.

“In other words, you had a situation where the response to excess money supply, little foreign exchange available was to fix exchange rates which now resulted in multiple exchange rates and arbitrage opportunities between one and the other and of course, this in itself, resulted in a backlog of foreign exchange, because this is where all these things have come from,” he said.

“Real sector at the time were obviously unable to access foreign exchange and things really got difficult and inflation continued to spike.”

Cardoso said upon assuming office, the CBN initiated a series of reforms to address the distortions.

One key reform, according to the CBN governor, was the attempt to harmonise the multiple exchange rates.

He said it has yielded positive results.

“Including the fact that you no longer have these multiple windows and including the fact that exchange rate is a lot more flexible and people are more able to transact their businesses through willing buyer, willing seller, as opposed to a situation where multiple exchange rates discourages or does not enable that to happen,” he added.

On January 29, CBN said it had started implementing a comprehensive strategy to improve liquidity in the Nigerian FX markets in the short, medium, and long term.

The apex bank said the FX reforms were designed to streamline and harmonise multiple exchange rates, promote transparency, and lessen the likelihood of arbitrage opportunities.

BIG STORY

Catholic Priest, Other Church Officials Arrested, Detained Over Abuja Palliative Stampede Deaths

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A senior Catholic priest in Nigeria’s Federal Capital Territory, Abuja, has been arrested over the tragic stampede that claimed 10 lives during the distribution of free food to the needy at “Holy Trinity Catholic Church, Maitama.”

It was gathered that a number of officials of the church involved in the planning and execution of the ill-fated charity event have also been arrested by security agents. All those arrested have been taken into detention and will likely spend Christmas behind bars, a top Catholic Church leader confirmed on Christmas Eve.

The arrests came against the background of demands by the Islamic activist group, “Muslim Rights Concern (MURIC),” for the arrest of those behind the event and a similar one in Okija, Anambra State, where 22 persons were confirmed dead in a billionaire businessman’s house. MURIC had demanded that organisers of a similar tragic charity event in Ibadan, Oyo State, who were taken to court and remanded in prison custody, should be released if those of the Abuja and Anambra events would not be given similar treatment.

Inspector General of Police, Dr. Kayode Egbetokun, had also ordered an investigation into the Abuja and Anambra tragic charity outreaches.

Reacting to the arrest and detention of his church officials, the Catholic Archbishop of Abuja Diocese, Most Rev. Ignatius Kaigama, last night condemned what he described as “verbal demonization of the Catholic Church” by some agents of government in responding to the tragedy at “Holy Trinity Catholic Church in Maitama.”

According to Kaigama, the detention of the priest as well as some officials of the church and the threat to slam criminal charges on the church “is to say the least, uninspiring, unfriendly and a misplaced zeal, and one wonders what purpose these were meant to serve.”

Archbishop Kaigama, who made his mind known in his Message titled, “Christmas: A Season of Hope and Renewal,” said that government officials should have focused on helping the organisers and the church to overcome their trauma instead of compounding it through arrest, detention, and threat of criminal prosecution.

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BIG STORY

Thousands Flock To Lagos For Africa’s Biggest Shopping, Entertainment Event [PHOTOS]

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Thousands of excited Nigerians attended the opening day of the much-anticipated maiden edition of the Lagos Shopping Festival (LSF) on Monday, December 23 and were served up an electrifying feast of events, activities and promotions across the the main venue of the festival, the iconic Mobolaji Johnson Arena, (formerly Onikan Stadium).

As advertised, first day of the festival lived up to its billing with a colourful blend of commerce, music, innovation and creativity following its flag off by the Executive Governor of Lagos State, Babajide Olusola Sanwo-Olu.

The Lagos Shopping Festival, powered by the Lagos State Government in collaboration with Chain Reactions Africa, a frontline PR firm, and supported by leading brands, including Zenith Bank, Tolaram Group, First Bank Plc, and Guinness, will see millions of people hit the main venue and select Lagos malls to bag the latest bargains, and bring together the best of city’s retail offering, showcasing local and top global brands and shopping experiences, including in-mall promotions.

Speaking at the event, Governor Sanwo-Olu described the LSF as a history-making festival of back-to-back shopping, fun, and entertainment, reaffirming the Lagos state’s commitment to grow small businesses as well as the entertainment industry.

“This is the first of its kind and this event is made to bring shoppers with MSMEs, with innovators, with entertainers, with the creative industry, with the food industry and everybody,” said Sanwo-Olu.

“For the next three days, we are meant to all come together, enjoy good food, good music, sales at discounted market price, shopping at the highest level and just general entertainment with the creativity of Lagos,” the Governor added.

He called on all Lagosians and Nigerian to join the fun, shopping and entertainment.

“Call everybody from Iyana-Ipaja to Alimosho, call people from Agege, call them from Ebute-Meta to Shomolu, call them from Bariga, from Badagry to Ikorodu, from Epe to Ibeju-Lekki, call everyone to come to the arena here at the Mobolaji Johson Center in Onikan where we’ll be doing shopping, we’ll be doing music, we’ll be doing entertainment for the next two days. This is the first of its kind”, Sanwo-Olu added.

He assured all fun-seekers, buyers and sellers of their safety, saying that they are in a safe, secure, peaceful environment, urging them to “to sit back, relax and see another Lagos creativity that is the first, and the very first Lagos Shopping Festival”.

Governor Sanwo-Olu expressed his appreciation to the sponsors of the Lagos Shopping Festival for their unwavering support to drive the story of Lagos commerce, entertainment and creativity.

“I want to thank all of our sponsors from FirstBank, to Zenith Bank, to Tolaram, to Smirnoff Ice, to Indomie Noodles, to OmniBiz, to PowerOil, to Minimie, and to Malta Guinness, all of them, including the Lagos State Government. I want to thank you”.

He also commended all the local and small businesses at the festival, and urged Lagosians and Nigerians to always patronize them.

“More importantly, to all the small businesses that are inside and under the canopies, go out there and make good deals. Go out there and do huge purchases from them. Go out there and make their small-scale market, work for them; because here, we want the market to be meeting all of the shoppers. That’s what this is all about. It’s about buying stuff at the most reduced market. It’s about entertainment, it’s about food, it’s about tourism. This is what Lagos has given to you again,” Sanwo-Olu said.

Also, commenting, the MD/ Chief Strategist, Chain Reactions Africa, the organisers of the Lagos Shopping Festival, Mr Israel Jaiye Opayemi, buttressed the strategic significance of the festival saying, “LSF is poised to be the catalyst that will redefine the true essence of commerce, especially SME businesses, the creative ecosystem, and fun times with family, friends and loved one. LSF is sure set to open a new vista of socio-economic growth from Lagos, to Nigeria, whilst raising a unique bar in the African market”.

Fun-seekers and business men and women alike had entertainment value for their time, with dancing and singing competition with the winners adjudged by the audience receiving cash gifts. The highlight of the day was the energy-revving musical performances from the youthful Ayo Maff, with the soulful rendition of songs from Adekunle Gold the icing on the cake for the audience who kept singing along to his enchanting stage performances.

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BIG STORY

JUST IN: Oriyomi Hamzat, Queen Naomi, School Principal Remanded In Agodi Prison Over Ibadan Stampede

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The Chief Magistrate Court sitting in Iyaganku, Ibadan, Oyo State has ordered the remand of Prophetess Naomi Silekunola, Alhaji Oriyomi Hamzat, and Mr. Abdullahi Fasasi at Agodi Correctional Center following their roles in the Ibadan Children Funfair stampede last week.

Amid heavy security, the three individuals, including the principal of Islamic High School, Bashorun Ibadan, Mr. Fasasi; the proprietor of Agidigbo FM, Alhaji Hamzat; and the estranged wife of the Ooni of Ile Ife, Oba Enitan Adeyeye Ogunwusi, Naomi Silekunola, were on Tuesday arraigned before the court over the incident.

The trio were arrested in connection with the Wednesday, December 18, 2024, stampede that occurred at Islamic High School, Ibadan, resulting in the death of 35 minors, while others sustained injuries.

Chief Magistrate Olabisi Ogunkanmi gave the order following the arraignment of the suspects in court on Tuesday.

The Police prosecutor accused the defendants of committing an offense contrary to Section 324 of the Criminal Code, Cap. 38, Vol. II, Laws of Oyo State of Nigeria, 2000 in a four-count charge for which they were arraigned.

The court premises was filled with relatives of the defendants and other interested parties.

 

More to come…

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