Prof. Uche Uwaleke, Head, Banking and Finance, Nasarawa State University, has urged the Federal Government to reduce the Monetary Policy Rate (MPR) to a single digit before the end of 2017.
Uwaleke made the call in an interview with the News Agency of Nigeria(NAN) on Thursday in Abuja.
“With respect to monetary policy, I advise the CBN to ease policy by gradually reducing the monetary policy rate from the current 14 per cent to single digit before the end of 2017.
“In my opinion, the conditions for foreign investments will be created, not necessarily by hiking interest rates, but more by addressing factors around the ease of doing business.
“Also, general business climate, including security, infrastructure, access to credit, anti-corruption and enabling laws will also aid foreign investments,” he said.
Regarding foreign exchange policy, Uwaleke said it would be suicidal to leave the fate of the naira entirely to market forces, due to the disequilibrium in favour of the demand side.
The don, however, urged the CBN to continue to defend the naira by sustaining the restrictions on certain items, from accessing the official window.
“The Forex market can be made more transparent in view of allegations of use of multiple exchange rates.
“Allocation of Forex to government officials at preferential rates should stop.
“The CBN should also drop the idea of using force to shut the parallel market, as this is bound to backfire on the economy.(NAN)