The Central Bank of Nigeria (CBN) has increased the Monetary Policy Rate (MPR) by another 100 basis points, to 17.5 percent from 16.5 percent, as part of its attempts to control inflation through monetary tightening.
The Governor of the Central Bank of Nigeria, Godwin Emefiele, spoke at the conclusion of the Monetary Policy Committee’s (MPC) first meeting of the year, which was held in Abuja on Tuesday.
He explained that although the previous rate hikes had already begun to reduce inflationary pressures, the outcome was not yet satisfactory enough to hold or lower the MPR.
His words, “We are happy that some of these policies that we introduced in the last couple of months in our attempt to rein in inflation are beginning to yield results, not just in plateauing but are beginning to drop.
“But MPC members feel that the 10 basis points drop from 21. 47% to 21.34% is just not good enough as a reason to begin to celebrate.
“We concluded that yes inflation rate was reducing, Year-on-Year, but the other underlining figures have not given us reasons to celebrate, as such we decided to be aggressive in our tightening.”
Only N370b Stamp Duty collected
Emefiele dismissed claims that CBN was holding N89 trillion Stamp Duty fund.
He said, “It beats our imagination that those arguments can come up. N89 trillion is so large. The total assets of the banking industry today is about N71 or N71.5 trillion. The total deposits of the banks is N44. 498 trillion.
“How then is it possible that Stamp duty of N89 trillion, that is twice the value of deposit of banks. How possible is that? Total Stamp Duty collected from 2016 to date is N370.686 billion. Out of this the Federal Inland Revenue Service (FIRS) has paid N226.462 billion to the Federation Accounts Allocation Committee (FAAC) leaving a balance of 144.234 billion in the CBN account”.