CBN MONETARY POLICY

MPC COMMUNIQUE HIGHLIGHTS
 
The committee alluded to the recent IMF global economic projection; where it stated that the global economic trajectory was headed for a contraction of about 4.9% for 2020 fiscal year.
Ø The committee accentuated on the inflationary pressure being witnessed mostly within the emerging markets and developing economies, a visible trend among developing commodity exporting nations that have persistently recorded a higher inflation rate, when compared with other diversified economies.
Ø Other factors that have heightened inflationary pressure was attributed to supply chain shortfall that has contributed to overblown demand pressure.
Ø The committee was more optimistic about a gradual recovery outlook for 2021 fiscal year, which is contrary to earlier high-pitched growth recovery trajectory, a view that aligns with the reviewed global growth projection of 5.4% for year 2021.
Ø The marginal growth of the Nation’s first quarter GDP of 1.87% were attributed to suppressed crude oil price and shock of the pandemic outbreak.
Ø The Nation’s GDP trajectory for the second quarter and remaining quarters of the year is posed for negative territory, while economic recovery is envisaged for 2021.
Ø The lagging trend in manufacturing and Non-manufacturing PMI readings were attributed to decline growth in production levels, new domestic orders, employment rate, raw materials supply, and new export orders.
Ø The nation’s unabated inflationary trend was fueled by increased food and core inflation, while lingering unresolved legacy structural factors have aided the upward trend.
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