As Nigerians continue to battle the harsh impact of the rising inflation rate and depreciation of the naira, anxiety over the direction of the economy heightened yesterday, as the Central Bank of Nigeria, CBN, deferred the bi-monthly Monetary Policy Committee (MPC) meeting for the second consecutive time.
The Monetary Policy Committee was created to facilitate the attainment of the objective of price stability and to support the economic policy of the Federal Government. The MPC, according to the CBN Act 2007, Section 12, is the highest policy-making organ of the apex bank.
Its mandate is to: “Review economic and financial conditions in the economy, determine appropriate stance of policy in the short to medium term, review regularly the CBN monetary policy framework and adopt changes when necessary, also to communicate monetary/financial policy decisions effectively to the public and ensure the credibility of the model of transmission mechanism of monetary policy.”
As a custom, the MPC committee meets every two months, except otherwise decided, in the event of an emergency compromise. The meeting of the committee slated for September 25th and 26th was, however, deferred by the CBN, apparently due to change in the leadership of the bank.
In a statement announcing the deferment, in September, the CBN’s Director, Corporate Communication Department, CBN, Dr. Isa AbdulMumin, stated:
“The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has deferred its 293rd meeting scheduled for Monday and Tuesday, September 25 and 26, 2023, respectively. A new date will be communicated in due course. We regret any inconvenience this change may cause our stakeholders and the general public.”
With the upward trend in the inflation rate which persisted in October, rising to 27.33 per cent, and continued naira depreciation, financial market analysts, investors and other economic players looked forward to major policy decisions on the economy at the November meeting of the MPC which by tradition should have held yesterday.
But the meeting did not hold and there was no official statement or explanation from the CBN.
However, sources close to the apex bank told reported that the MPC is mandated to meet a minimum of four times, and since the committee has met four times this year, another meeting is not compulsory.
Financial sector operators, investors and economists, however, said this development impedes critical investment decisions as it increases uncertainty and risk in the economy.
