The Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, has said that with the current efforts by the Federal Government to revive the country’s economy, the country should be out of recession by the third quarter of this year.
Emefiele also said the CBN would continue with its intervention in the foreign exchange market, adding that efforts by the apex bank so far had been yielding positive results.
He added that the country had started to see a downward trend in the prices of commodities, indicating a reduction in the rate of inflation.
“We are very much optimistic that by the end of the second quarter, or latest the third quarter, we should be out of recession that we are in right now,” he said.
The CBN governor said these after meeting with the leadership of the Senate in Abuja on Tuesday.
In attendance at the closed door meeting were the President of the Senate, Bukola Saraki; and Chairman, Senate Committee on Banking, Insurance and Other Financial Institutions, Rafiu Ibrahim.
Emefiele, while briefing journalists after the meeting, said discussions were held between the apex bank and the legislature on the current state of the economy.
He said, “Actually, the Senate President invited us to come and brief the Senate leadership in a closed session and to provide some updates on the foreign exchange markets. You would have observed that in the last two months, the central bank has been involved in some form of intensive intervention in the foreign exchange market and this has fortunately resulted in a downward trend in the parallel market price of foreign exchange, from as high as N525 to a dollar to as low as N370.
“Right now, it hovers between N370 and N380. I think it’s an opportunity for me to say that we are going to continue this intervention because the reserves look very good. As I speak to you, our (external) reserves stand at above $31bn and that provides us enough of firepower or ammunition to be able to defend the currency, and we will do so with all intensity to ensure that foreign exchange is procured by everybody.
“If you want to import raw materials, you will get foreign exchange; you want to import plant and equipment, you will get foreign exchange; you want to pay school fees or you are a small business that wants to buy foreign exchange for you to import your small items, you will procure foreign exchange.”
Emefiele recalled that the CBN had last week announced a policy to encourage foreign investors in the country’s forex market.
He said, “It is the market or window that is opened for them to bring in their foreign exchange and come into the market on what we call a willing-buyer, willing-seller basis, in which case there will be no form of any price intervention by anybody, including the Central Bank of Nigeria.
“Indeed, with the kind of firepower that we have, we are also going to play in that market to ensure that as the prices move on based on the managed float regime that we run, we should be able to control the price based on the willing-buyer, willing-seller basis.”
In his remarks, Ibrahim said the meeting was part of the engagements between the legislature and the executive.
He stated, “As usual, the leadership of the Senate is always engaging the most important sectors of our economy. So, we had a discussion with the Senate President and the (CBN) governor and they were briefed just like he (Emefiele) has given you an overview of the briefing.
“We have proffered more solutions, which will result in more policy directions very soon, because the major reason is for us to attract foreign direct investments so that the watchers, that is, the reserves, and the monetary aspect of the economy will be intact and the intervention will be sustainable.
“So, we are happy with what they (CBN) are doing and we have been able to proffer more solutions as usual and more suggestions. We are hopeful that by the grace of God, we will be able to sustain working together.”