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How CBN Contributed To Rising Inflation – Ex CBN Deputy

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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.”

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DStv, GOtv Subscribers To Experience Service Outages

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Subscribers of DSTV and GOtv in Nigeria have been notified of upcoming service disruptions from Sunday, May 5, to Tuesday, May 7, due to ongoing construction on the Lagos-Calabar Coastal Highway.

DStv reassured its customers via social media that technical staff will be relocating a facility within the right-of-way to minimize service interruptions during this time.

The statement read, “Our uplink facility will be impacted by the ongoing Lagos-Calabar Coastal Road construction project. As a result, we are forced to relocate.

“From Sunday, May 5, 2024 to Tuesday May 7, 2024, our technical team will be working tirelessly to relocate and minimise disruptions during the exercise.

“We appreciate your patience and understanding during this period and remain dedicated to delivering the quality service and support you expect from DStv and GOtv.”

 

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Court Slaps Linda Ikeji With N30m Damages To NBM

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A Delta State High Court in Effurun has ruled in favor of the Registered Trustees of the Neo-Black Movement of Africa, awarding them N30 million in damages in a libel case against popular Nigerian blogger, Linda Ikeji.

The lawsuit, with Ese Kakor, Felix Kupa, and Mayor Onyebueke as claimants, resulted in the court ordering Ikeji to pay N300,000 in litigation costs.

Presiding Justice Roli Daibo-Harriman delivered the verdict in Suit No: EHC/210/2021 on Monday.

Additionally, Ikeji was instructed to publish a retraction of the libellous statements on her blog and in national dailies.

Furthermore, Ikeji has been restrained from making further damaging publications against the claimants.

The Neo-Black Movement of Africa (NBM) took the legal action against Linda Ikeji after she allegedly failed to retract and apologize for a defamatory article published on her blog on October 19, 2021.

The article reportedly labeled the NBM of Africa as a dreaded cult group, black axe, and criminal organization, prompting the claimants to seek N1 billion in damages and an unreserved apology to be published on Ikeji’s blog and in two national newspapers.

Justice Daibo-Harriman, in her ruling, deemed the terms “dreaded cultist group,” “black axe,” and “criminal organization” used in the Defendant’s publication as defamatory.

Kelvin Agbroko, Counsel to the Claimants, emphasized that the ruling “Will serve as a lesson to bloggers that it is not every item you publish. It is good to verify information before making a publication.”

He said, “NBM of Africa is a legal organisation duly registered with the Corporate Affairs Commission. The publication made by the Defendant against my client has been cleared that it was a damaging publication.

“NBM is good to go, we are going to take all necessary steps to enforce the terms of the judgment against her. It was an erudite judgement that is all-encompassing and will be difficult to fault.”

Ese Kakor, President of the NBM of Africa, revealed that the legal proceedings regarding the case had been ongoing for approximately two years.

Kakor expressed his dismay at Linda Ikeji’s actions, stating, “What Ikeji did was just to sell in a bid to defame the character of NBM of Africa. It is very wrong.”

He advised other bloggers against following similar steps, cautioning that they may also face litigation for defamation.

Kakor clarified that the NBM of Africa has no association with cultism, black axe, or criminal activities, emphasizing that it is a well-registered organization.

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Tragedy As VGC Chairman Found Dead In His Car

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In a shocking turn of events, Gihan Mbelu, the esteemed chairman of Victoria Garden City in Lagos’s bustling Lekki area, was found lifeless inside his vehicle.

 

His sudden demise has prompts police inquiry into the mysterious circumstances surrounding his death.

The 42-year-old financial luminary and venture capitalist was found unconscious in his opulent C300 4Matic vehicle around 10:10 am on Friday, April 26, 2024.

According to report, Mbelu was swiftly transported to the Lagos University Teaching Hospital, where a doctor on duty confirmed his unfortunate demise.

Meanwhile, concerned individuals took it upon themselves to examine his vehicle, which had been running for hours at the spot where it was parked.

The post reads “Concerned by the discovery, some of the people in the area, upon close observation of the vehicle, found Mbelu in it.

“While some people speculated that the 42-year-old man might be sleeping, some other persons, who were bent on ascertaining Mbelu’s true state, reportedly made frantic efforts to wake him up but it proved abortive.

“In a bid to rescue Mbelu, it was learnt that he was rushed to the Lagos University Teaching Hospital where he was reportedly confirmed dead by one of the doctors on duty.

“Mbelu’s corpse was said to have been deposited in the hospital’s morgue. The case was also reported to the police for an investigation to commence to ascertain the circumstances surrounding Mbelu’s death.”

Prior to his demise, Mbelu was married to Eloho, a distinguished tech entrepreneur, former investment banker, and private equity investor. Together, they are parents to two daughters.

In response to the news, Benjamin Hundeyin, the spokesperson for the state police command, affirmed the incident on Saturday, April 27, disclosing that an investigation has been launched into the matter.

 

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