By Bashir Olanrewaju
Nigeria Central Bank Holds Rate, Concern Shifts to Naira
The Central Bank of Nigeria’s Monetary Policy Committee left the benchmark interest rate unchanged as the monetary authorities were seized by concern about the free fall of the country’s currency.
The MPC members voted unanimously to keep the interest rate at 11.5 percent. All other parameters, including the cash reserve ratio and the liquidity ratio, were left unchanged, Governor Godwin Emefiele said at a briefing on Friday.
“A hold stance would allow the current recovery of output growth and decline in inflation to continue smoothly and gradually moving the economy to a sustainable path,” he said.
Emefiele expressed concern about the rapid fall of the naira in the parallel market, where it exchanged for 570 naira to a dollar on Friday, representing a 10 percent loss of value in one month.
The central bank Governor blamed speculators and those funding criminal activities for the situation and singled out a website that publishes street rates, abokifx.com, for special blame.
Emefiele accused the website of manipulating parallel market rates and profiting from the action, saying the authorities have begun criminal investigations on the owner he identified as Adedotun Oniwinde, a Nigerian based in London.
“We do not trade FX neither do we have the power to manipulate the rates as WE DO NOT CREATE the rates ” Abokifx said in a pushback to the allegations published on its site.
Describing itself as a research company that started publishing parallel market rates in 2014 when the naira exchanged for 160 to a dollar.
The website said it had decided to temporarily suspend the publication of the rates following the allegations by the central bank.