Financial experts have called on the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) to adopt a more realistic approach to its policy decisions.

This advice is coming as the MPC is scheduled to hold its bi-monthly meeting on Monday.

The experts, who spoke in separate interviews, urged the committee to take practical policy decisions to tackle the country’s monetary and economic challenges effectively.

A past president of the Chartered Institute of Bankers of Nigeria (CIBN), Okechukwu Unegbu, urged the committee to conduct extensive research on the economy before coming out with its parameters.

Mr Unegbu said that the idea of retaining the same parameters for several months without any positive economic impact gave the impression that the MPC meetings were merely routine.

The MPC had retained the Monetary Policy Rate (MPR) at 11.5 per cent and held all other parameters constant at its last nine meetings.

“Retaining the same parameters for such a long time without visible improvements indicates that the committee and the apex bank are not doing enough,” he stated.

Mr Unegbu also advised the apex bank to cut down on its intervention in different economic sectors so as not to “cause dislocation in the monetary system”.

An economist, Lanre Olaniyan, said retaining the same parameters for the umpteenth time amid rising inflation and other economic challenges means something is not right.

Mr Olaniyan, a professor of economics from the University of Ibadan, urged the MPC to take cognisance of the impact of its prevailing parameters to be guided appropriately.

However, another economist, Tope Fasua, urged the MPC to be cautious in its policy decisions not to worsen the situation.

“Except we want the CBN to be adventurous, if they increase the Monetary Policy Rate (MPR),  it’s a cue for the Deposit Money Banks to increase lending rates.

“And, usually, lending rates will be increased a lot more than deposit rates.

“The manufacturers and other stakeholders will blame the apex bank for making their lives more difficult. But if they do that, the aim could also be to slow down inflation.

“The second point is that, if they reduce, inflation might continue to grow. If we want to be experimental we could push for a reduction in rates,” he suggested.

At the last MPC meeting in March, the 10 members present were divided on the policy decisions and parameters to adopt.

Three members had voted to raise MPR by 25 basis points, one member voted to raise MPR by 50 basis points while six other members voted to hold all parameters constant.

According to the CBN governor, Godwin Emefiele, the committee was of the view that increasing the rates during inflation could adversely impact on economic recovery and stifle expected investment expansion.

(NAN)