L
LequteMan
Guest
Mr Lamido Sanusi, Governor of the Central Bank of Nigeria (CBN) at a news briefing after the Bank’s Monetary Policy Committee (MPC) meeting in Abuja on Tuesday has urged the Federal Government to increase the country’s external reserves.
He said the measure became necessary to safeguard the country’s financial market as Nigeria’s financial market was ``extremely fragile’’ and susceptible to external shocks due to its low external reserves.
`` The committee noted that the increase in external reserves to 45.37 billion U.S dollars as at November 15, 2013, representing an increase of 2.85 per cent above the 44.11 billion U.S dollars as at end of September 2013.
Sanusi said although government had moderated its spending in the second half of the year, the country’s Excess Crude Account (ECA) was diminishing.
``The Federal Government debt has also risen phenomenally along with its deposit money banks, showing the government as a net creditor to the system.
``This underscores the urgent need for immediate implementation of the Treasury Single Account.
``The continued delay in returning government accounts to the Central Bank is adding to the huge cost of government debt due to poor cash flow management,’’ he said.
The CBN governor called on the fiscal authorities to rebuild buffers in the ECA by blocking fiscal leakages in the oil sector and increasing oil revenues.
Sanusi said the MPC was retaining the Monetary Policy Rate (MPR) also known as lending rate
For over a year, the MPC continues to retain the 12 per cent benchmark lending rate (MPR) to ensure price and exchange rate stability.
Sanusi also said the Asset Management Corporation of Nigeria (AMCON) was expected to reduce its debt by one trillion naira by December.
He added that the transaction was not expected to have any impact on the money market because the debt would be paid for, by exchanging them for a Federal Government Treasury Bill.
He said the measure became necessary to safeguard the country’s financial market as Nigeria’s financial market was ``extremely fragile’’ and susceptible to external shocks due to its low external reserves.
`` The committee noted that the increase in external reserves to 45.37 billion U.S dollars as at November 15, 2013, representing an increase of 2.85 per cent above the 44.11 billion U.S dollars as at end of September 2013.
Sanusi said although government had moderated its spending in the second half of the year, the country’s Excess Crude Account (ECA) was diminishing.
``The Federal Government debt has also risen phenomenally along with its deposit money banks, showing the government as a net creditor to the system.
``This underscores the urgent need for immediate implementation of the Treasury Single Account.
``The continued delay in returning government accounts to the Central Bank is adding to the huge cost of government debt due to poor cash flow management,’’ he said.
The CBN governor called on the fiscal authorities to rebuild buffers in the ECA by blocking fiscal leakages in the oil sector and increasing oil revenues.
Sanusi said the MPC was retaining the Monetary Policy Rate (MPR) also known as lending rate
For over a year, the MPC continues to retain the 12 per cent benchmark lending rate (MPR) to ensure price and exchange rate stability.
Sanusi also said the Asset Management Corporation of Nigeria (AMCON) was expected to reduce its debt by one trillion naira by December.
He added that the transaction was not expected to have any impact on the money market because the debt would be paid for, by exchanging them for a Federal Government Treasury Bill.
