By Aduragbemi Omiyale
The much-awaited Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) commenced today, Monday, September 26, 2022.
It is the last, but one meeting of the monetary team saddled with the responsibility of determining the Monetary Policy Rate (MPR) for the country.
The meeting is for two days. The first leg of the gathering started at 10 am today at the MPC Meeting Room on the 11th Floor of the headquarters of the CBN in Abuja.
Tomorrow, Tuesday, September 27, 2022, the second part of the gathering will take place at the same venue by 8 am.
After about five hours or more, the Governor of the CBN, Mr Godwin Emefiele, will inform the public, through the media, of the outcome of the MPC meeting.
He will address journalists on the team’s decision after deliberations, especially after carefully looking at the economic parameters, including the inflation rate, the gross domestic product (GDP), and the money in circulation, among others.
At the last gathering, which occurred precisely in July, the anchor interest rate was increased by 100 basis points to 14.0 per cent from 13.0 per cent. This action was taken mainly to control the rising inflation.
About two weeks ago, the National Bureau of Statistics (NBS) announced that the inflation rate in Nigeria jumped to 20.52 per cent in August 2022 from 19.64 per cent in July 2022.
Last week, the major central banks across the globe further hiked interest rates to tackle inflation, and it is expected that Nigeria will follow suit.
Inflation in Nigeria has been triggered by the rising cost of food items as a result of insecurity in the northern part of the country, where most of the food crops are planted.
This year’s problem has majorly been caused by flooding and the inability of farmers to go to their farms as a result of bandits and terrorists, who collect taxes from them before crops can be planted.
Efforts by the government to protect the farmers have not yielded the expected results.
Members of the MPC will look at these issues and give their expert view on whether the rate should be lowered, raised or left intact. But observers believe that the interest rate would be further increased to reduce money in the financial system and then hope that the prices of goods and services will decrease to attract more consumers.
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Aduragbemi Omiyale is a journalist with Business Post Nigeria, who has passion for news writing. In her leisure time, she loves to read.
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By Dipo Olowookere
Some of the gains recorded by the Nigerian Exchange (NGX) Limited on Monday were given up on Tuesday following the raising of the benchmark interest rate by 1.5 per cent to 15.5 per cent by the Central Bank of Nigeria (CBN).
The apex bank announced this hike in rate after its Monetary Policy Committee (MPC) meeting in Abuja. It explained that it was to tame the rising inflation, currently at 20.52 per cent.
Investors were unhappy with this action, and they abandoned Nigerian stocks, causing the bourse to deflate by 0.06 per cent at the close of transactions.
More profit-taking is expected in the coming days as traders attempt to leave the volatile space for a less-risky fixed income market, where the return on investment is nearing 15 per cent.
Business Post observed more sell-offs in the banking and consumer goods sectors as they respectively lost 0.65 per cent and 0.52 per cent yesterday. However, the energy and insurance counters grew by 0.20 per cent and 0.06 per cent, respectively, while the industrial goods space closed flat.
At the close of business, the All-Share Index (ASI) was down by 27.87 points to 49,161.45 points from 49,189.32 points as the market capitalisation decreased by N13 billion to N26.519 trillion from N26.532 trillion.
May and Baker recorded the highest price decline on Tuesday, losing 9.79 per cent to N3.50, with Regency Assurance declining by 7.69 per cent to 24 Kobo. Vitafoam fell by 6.98 per cent to N20.00, Unilever Nigeria went down by 5.38 per cent to N12.30, and GlaxoSmithKline dropped 5.08 per cent to N5.60.
On the flip side, NGX Group and Multiverse topped the gainers’ log after their values rose by 10.00 per cent each to N19.80 and N3.41, respectively. Eterna gained 9.91 per cent to N6.32, Courteville grew by 8.89 per cent to 49 Kobo, and Champion Breweries expanded by 8.53 per cent to N3.69.
Analysis of the trading data showed that investor sentiment remained weak as the market breadth finished negative with 17 price losers and 13 price gainers.
Transcorp was the busiest stock yesterday as it transacted 38.5 million units for N39.0 million, followed by Zenith Bank, which sold 35.3 million units worth N710.8 million. FCMB traded 30.2 million shares valued at N105.6 million, Vitafoam transacted 18.1 million stocks for N362.8 million, and Linkage Assurance sold 8.9 million equities valued at N4.2 million.
In all, investors bought and sold 206.2 million stocks worth N2.4 billion in 3,679 deals on Tuesday, in contrast to the 119.3 million stocks worth N854.8 million traded in 3,580 deals on Monday. This implied that the trading volume, value and number of deals increased by 72.87 per cent, 176.38 per cent and 2.77 per cent apiece.
By Adedapo Adesanya
The easing of the United States Dollar and the threats of a possible disruption in the supply of crude oil in the Gulf of Mexico due to Hurricane Ian pushed prices higher on Tuesday.
The Brent crude appreciated by $2.21 or 2.6 per cent yesterday to sell at $86.27 a barrel as the West Texas Intermediate (WTI) crude grew by $1.79 or 2 per cent to trade at $78.50 per barrel.
US offshore oil producers said they were keeping an eye on Hurricane Ian’s track as the powerful storm shut-in about 11 per cent of oil production in the U.S. Gulf of Mexico as it barrelled toward Florida.
The hurricane entered the US Gulf of Mexico on Tuesday and is forecast to become a dangerous, Category 4 storm over the warm waters of the Gulf.
Some 190,000 barrels per day of oil production or 11 per cent of the Gulf’s total, were shut-in, according to the offshore regulator, the Bureau of Safety and Environmental Enforcement (BSEE). Producers lost 184 million cubic feet of natural gas or nearly 9 per cent of daily output.
Personnel were evacuated from 14 production platforms and rigs, BSEE said.
It is the first hurricane this year to disrupt oil and gas production in the US Gulf of Mexico, which produces about 15 per cent of the nation’s crude oil and 5 per cent of dry natural gas.
Also supporting prices, the US Dollar, which eased from a 20-year high, also helped support oil. A strong US Dollar makes crude more expensive for buyers using other currencies.
The oil price drop in recent months has raised speculation that the Organisation of the Petroleum Exporting Countries and allies (OPEC+) could intervene. Iraq’s oil minister on Monday said the group was monitoring prices and did not want a sharp increase or a collapse.
OPEC+ may take action to stem the price drop by cutting supply, which also lent support. The alliance meets to set policy on October 5.
Russia will likely propose at the next OPEC+ meeting that the group cut 1 million barrels per day from the group’s collective output, sources familiar with Russian thinking shared on Tuesday.
By Adedapo Adesanya
The federal government has disclosed that Nigeria’s livestock sector has a huge economic potential worth over N33 trillion yearly if properly harnessed.
The Permanent Secretary of the Federal Ministry of Agriculture and Rural Development (FMARD), Mr Ernest Umakhihe, disclosed this in Benin City, Edo State, during the inauguration of the Edo chapter of the Animal Science Association of Nigeria (ASAN).
Mr Umakhihe noted that the sub-sector was estimated to contribute about 17 per cent of the Agricultural Gross Domestic Product (GDP) and 5.0 per cent of the national GDP.
“As we all know, the livestock sector is very vital to the socioeconomic development of the country, and it represents an important source of high-quality animal protein.
“It provides about 36.5 per cent of the total protein intake of Nigerians, generates employment and income, and earns foreign exchange for the country.
“The Edo State Government, through the FMARD and Food Security, is interested in improving livestock production hence the creation of the animal husbandry department in the ministry.
“I urge you all to take advantage of this department to explore the huge potentials in the animal husbandry subsector,” Umakhihe said.
Also, the Registrar of the Nigerian Institute of Animal Science (NIAS), Professor Eustace Iyayi, commended the state government for creating an animal husbandry department.
He said: “As an institute, we are going to key into the mandate of helping the state grow livestock to harness the potentials in the sector.
“I am confident that at a time when Nigeria’s oil industry is failing, we will be able to tap into the N33 trillion huge potential earnings in the value chain.”
According to him, Edo was one of those states with a department of animal husbandry, with our efforts, we ensure that today it has been created.
Speaking for the Edo state government, the Special Adviser to Governor Godwin Obaseki on Livestock, Mr Bashiru Kadiri, commended the initiative to inaugurate the Edo chapter of ASAN, noting that no system can develop if there is no clear define role and how.
According to him, the governor believed that the livestock and the entire animal husbandry must thrive hence the implementation of the Edo State livestock initiative programme in the state.
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