The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) on Friday foreclosed the possibility of devaluing the naira, saying it has sufficient foreign reserves to meet all its obligations without recourse to hurting Nigeria’s currency.
CBN Governor, Godwin Emefiele who made the disclosure at the 271st MPC meeting and first one in 2020, held in Abuja, said the decision was taken by all 11 members of the MPC who were in attendance.
Emefiele was reacting to speculations by economic experts who opined that the apex bank may likely devalue the naira amidst a sharp reduction in foreign reserves from about $47 billion to $38 billion in few months in 2019.
Emefiele said: “We should realise that reserves are there to meet obligations. At times it’ll go up and at times, it’ll reduce.
But with reserve of about $38 billion today and crude prices hitting up to $70 a barrel, we can sustain the economy without devaluing the naira.
So, adjustments won’t happen. Our reserve level will meet all our obligations. Anyone expecting us expecting us to adjust the naira should know that it won’t happen”, he said.
The CBN Governor also warned the fiscal authorities against further heavy borrowing, saying that the nation’s debt status has become a cause for concern.
According to Emefiele, the narrative that Nigeria’s debt to GDP ratio was about the lowest in the world should not spur the fiscal authorities to hurt the economy with huge debts. – CBN.