The Central Bank of Nigeria denies devaluing the naira and is committed to gradual rate convergence, according to the Deputy Governor for Economic Policy. Obiora announced in Abuja yesterday at the FALC retreat that while the import and export window has adjusted rates, the CBN has not done so officially. The bank supposedly devalued the local currency to N631/$, according to a report. However, a statement from the Acting Director of Corporate Communications, Dr. Isa AbdulMumin, denied the report, saying the I&E window traded at N465/$ yesterday. The apex bank aims for rates to gradually converge around the I&E window.
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Expect high inflation if the naira is devalued in the next few days, warns financial analyst Paul Alaje. He predicts a 34–38% inflation increase in the next 2-3 months. However, the devaluation will boost foreign investment and diaspora remittances. “More companies will keep their export proceeds instead of sending them abroad or buying equipment to sell,” he said.
The Finance Ministry’s Permanent Secretary, Aliyu Ahmed, urged boosting non-oil revenue using the FIRS and NCS initiatives to enhance national revenue. Despite several taxation and revenue-generating reforms, revenue is still inadequate for the government to facilitate sustainable and inclusive development. “Policy coordination and consistency are necessary to address inflation and maintain financial system stability. Achieving fiscal objectives through the use of technology is also important,” says Dr. Director of Monetary Policy, CBN. Hassan Mahmud of the CBN stated that the bank would employ quasi-fiscal measures to aid the government in managing the economy and addressing liquidity challenges in the face of global changes. He acknowledged that the government’s response to these changes had led to a rise in public debt and service costs despite increased budgetary allocations for economic advancement and social safety nets.
Electronic payments impact monetary policy management and call for fiscal consolidation to boost revenue and expenditure efficiency. “It is crucial for fiscal and monetary authorities to collaborate and ensure attainable macroeconomic goals in current conditions,” he stated.
