A financial expert, Dr Tunde Adeoye, on Wednesday urged the Central Bank of Nigeria (CBN) to stimulate the domestic economy and encourage local production.
Adeoye, a Senior Lecturer, Department of Economics, University of Lagos, made this known in an interview with the News Agency of Nigeria (NAN) in Ota, Ogun State.
He said that the steps were necessary to ease Nigeria out of recession.
The economist spoke against the backdrop of the decision of the Monetary Policy Committee of CBN to retain all its monetary instruments.
The committee had on Tuesday retained the Monetary Policy Rate (MPR) at 14 per cent, Cash Reserve Ratio (CRR) at 22.5 per cent and Liquidity Ratio at 30 per cent.
According to him, the implication is that the CBN is not ready to take risk by reducing the rates because of the current recession.
Adeoye urged the apex bank to compact the economy and embark on expansionary policies that would boost the economy.
“I don’t know why the CBN is now recycling the monetary policy rate.
“It is more or less like monetary recycling strategy that the CBN is embarking upon,’’ the economist said.
Adeoye said the decision would make it difficult for entrepreneurs to access loans from the financial sectors.
“If the whole essence of retaining the monetary policy was to target the inflation in the country, the CBN could have to stimulate the economy by encouraging entrepreneurs to produce more goods and services.
“At this time of recession that the economy is recovering, what the CBN could have done is to stimulate the economy by encouraging entrepreneurs to produce more goods and services to bring down the inflation rate,’’ he contended.
Adeoye believed that the rate of inflation in the country at the moment was a result of low production. (NAN)