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How CBN Contributed To Rising Inflation – Ex CBN Deputy
Kingsley Moghalu, the former Deputy Governor of the Central Bank of Nigeria (CBN), has attributed the country’s inflation to the ongoing practice of the apex bank financing the federal government’s deficits.
According to Moghalu, as long as the government continues to rely on ways and means to address its deficits, inflation will persistently increase.
He further emphasized that inflation is not solely defined as an excessive amount of money pursuing a limited number of goods, but also involves a cost-push element.
Kingsley Moghalu, a political economist and former presidential aspirant made this known during an interview with ARISE TV.
Recall hat in the first 10 months of 2022, the Federal Government of Nigeria borrowed a total of N6.3 trillion from the Central Bank of Nigeria (CBN) through the practice of ways and means advances.
Additionally, in May 2023, the Senate approved a CBN loan amounting to N22.7 trillion, which had been utilized by the executive arm of the government.
In May 2023, the Nigerian Senate made amendments to the CBN Act, specifically increasing the borrowing threshold for the federal government through ways and means.
The amendment raised the threshold from 5 to 15 percent, allowing the government greater flexibility in accessing funds through this mechanism.
Moghalu highlighted that amidst the removal of petrol subsidy and the floatation of the naira, the inflationary impact is the most significant and immediate threat.
He said “So, inflation in Nigeria is going to just continue to shoot up in the immediate time, that is a fact.
“This becomes a challenge because in order to attract capital, when you have a very stiff rise in inflation, most times you need to keep interest rates high for a while, but Nigeria’s economy is very funny, it doesn’t always follow the textbooks.”
Moghalu said there were many reasons for the continuous surge despite raising interest rates.
According to the economist, what is causing this current round of inflation is “not the standard definition of inflation of too much money chasing too few goods only, there is also a cost-push factor.
Moghalu said, “Also, the central bank itself was contributing to inflation through the monetary phenomenon of illegal financing of the federal government’s massive deficits to the tune of N23 trillion, in ways and means lending”.
“Of course, you’re contributing to inflation with one hand you say you’re fighting inflation with the other hand. Why was the ways and means lending so high? It is because you have a government that could not manage its fiscal books and there you have the fiscal period of the price ladder being also relevant in addition to the quantity theory of money and how they play out in the market that causes inflation.”
In support of his argument, the former Deputy Governor of the Central Bank of Nigeria stressed the importance of the apex bank’s independence from government influence in effectively managing inflation.
According to him, maintaining the autonomy of the central bank is crucial to ensuring sound monetary policies and mitigating inflationary pressures.
He added “If the federal government is far more responsible, and disciplined with the budget and with spending, it will help the central bank to manage inflation, but then the federal government is just spending or borrowing like a drunken sailor, and then the central bank alone has to manage the inflationary consequences. It becomes very difficult.”
Super Eagles Captain, Ahmed Musa has been signed up by Jaiz Bank as a brand ambassador.
An elated Musa made the disclosure in a statement on his verified handle on micro-blogging site, X on Thursday.
The Kano Pillars striker urged his fans to troop to Jaiz Bank to do business for trusting him with the new role.
He exclaimed, “And to my amazing fans – if you want to support me, make sure to head over to Jaiz Bank and open your accounts with them today! ”
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He wrote, “✨Alhamdulillah✨ I am SO excited to announce that I’ve officially joined Jaiz Bank as their newest ambassador! 🎉💼
“A huge thank you to @JaizBankNG for trusting me and allowing me to be a part of this amazing journey! 🙏🏼💚 It’s an honor to represent a brand that believes in growth, security, and financial empowerment.
“I can’t wait to share all the incredible things we’ll be doing together! 🚀💡
And to my amazing fans – if you want to support me, make sure to head over to Jaiz Bank and open your accounts with them today! Let’s grow together! 💪🏼🔑
“@JaizBankNG is a non interest Financial institution poised with a mission to make life better through ethical Finance. 👌👌”
#NewBeginnings #BankWithJaizBank #PartneredUp #TeamJaizBank”
On November 20, 2024, Kenya’s First Lady, Rachel Ruto, celebrated her 56th birthday and her husband President William Ruto publicly expressed his love and appreciation for his wife on this special day, wishing her well.
The birthday celebrations were marked by an outpouring of goodwill from political figures, media, and citizens across Kenya, who praised her for her grace, leadership, and significant contributions to society, particularly through initiatives like the Joyful Women Organisation, which aims to empower rural women.
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The day was characterized by a collective acknowledgment of her role as a national figure dedicated to community upliftment.
In a heartfelt message, President William Ruto took to social media, writing, “Happy birthday my love, @MamaRachelRuto. Continue being a blessing to me and our children. Mungu akubariki sana,” which translates to “God bless you abundantly.”
Other prominent leaders also extended their wishes to the First Lady, with Anne Waiguru, EGH, OGW, Governor of Kirinyaga County, tweeting, “Happy Birthday First Lady,” further showing the respect and admiration for Rachel Ruto’s leadership and impact.
A gas cylinder explosion at a filling station in Jibia Local Government Area of Katsina State has resulted in significant damage to six vehicles, according to a statement from the Katsina State Police Command.
The command’s spokesperson, Abubakar Sadiq-Aliyu, confirmed the incident, which occurred on Friday, November 15, 2024.
He explained that a loud explosion alerted police operatives from the Jibia Divisional Police Headquarters. Responding promptly, the Divisional Police Officer led a team to the site, supported by military personnel.
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“Upon arrival, operatives found a truck loaded with gas cylinders engulfed in flames at Tamal filling station, along Kagadama-Magamar Jibia Road,” Sadiq-Aliyu stated. The joint team acted swiftly, deploying measures to protect lives and limit property damage. Their efforts successfully extinguished the fire.
The spokesperson added, “Six motor vehicles were significantly affected by the fire incident, but fortunately, no life was lost.”
State Commissioner of Police, Aliyu Abubakar-Musa, has directed a thorough investigation to determine the cause of the explosion. Updates on the findings will be provided as investigations progress.
This incident highlights the need for heightened safety measures at gas filling stations to prevent such occurrences.
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