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Investors Panic as Lack of Quorum May Stall 2018 MPC Meeting



MPC Meeting

By Dipo Olowookere

There is anxiety in the Nigerian business space as the first Monetary Policy Committee (MPC) meeting for 2018, scheduled for the third week of January, may not hold due to lack of quorum.

The MPC is a body set up to maintain price stability and support the economic policies of the federal government by formulating monetary and credit policies.

The committee has the Central Bank of Nigeria (CBN) Governor as Chairman; the four deputy governors of the apex bank; two members of the board of directors of the CBN; three members appointed by the President; and two members appointed by the Governor.

By the end of this year, eight positions in the 12-member committee would have become vacant, making it impossible for it to form the quorum required for it to meet.

In October 2017, President Muhammadu Buhari nominated Mrs Aisha Ahmad as a Deputy Governor of the CBN to replace Mrs Sarah Alade, who retired from the bank in June.

He also nominated Professor Adeola Festus Adenikinju, Dr Aliyu Rafindadi Sanusi, Dr Robert Chikwendu Asogwa and Dr Asheikh A. Maidugu as members to fill the positions of four others whose tenure would expire at the end of the year.

Meanwhile, Alhaji Suleiman Barau, another deputy governor of the central bank, who is also a member of the committee, retired recently. The President is yet to name a replacement for him.

But the President’s nominees sent to the Senate for confirmation have not been considered at all. The upper parliament has refused to consider the President’s nominees because of its resolution to suspend all executive confirmation requests for positions not listed in the 1999 Constitution as amended until the Acting Chairman of the Economic and Financial Crimes Commission (EFCC), Mr Ibrahim Magu, was removed.

The Senate last week adjourned to January 9 for its Christmas/New Year recess, while plenary session would begin on January 16.

This development has made uncertain the January meeting of the committee, which has operational independence in setting interest rate as well as designing monetary policy for the country.

Speaking in a chat with THISDAY, the Director General of the West African Institute for Financial and Economic Management (WAIFEM), Prof. Akpan Ekpo, expressed concern over the development.

According to Mr Ekpo, it would create uncertainty among investors.

He said: “There might not be an MPC meeting because they would not be able to form a quorum and if the MPC does not meet it would send a wrong signal to the international investors because it means that there is still uncertainty in the system.

“The way it is now, we are in a limbo and if MPC does not meet, it means that there won’t be decisive actions on monetary policy. The MPC is the engine room for monetary policy and so if they cannot meet to deliberate on the economy and relevant issues, you increase uncertainty in the system.

“The central bank’s mandate is price stability and it is very crucial in any economy. We have always argued that such delays would always cause problem for us.

“So, my advice is that they should stop this delay because it has adverse effect on the economy. So, even if they have to come back from recess and confirm the MPC members, they should do so.”

However, in his reaction, the chief executive of the Financial Derivatives Company Limited, Mr Bismarck Rewane, said there was no need for panic.

Mr Rewane expressed optimism that the new MPC members would be confirmed before the next meeting.

He said: “I don’t think that is a problem. There is still time between now and then. The meeting is not until third week in January for the MPC and I believe the Senate would be able to deal with it before then.”

Nevertheless, when reminded that the Senate would resume fully on January 16, Mr Rewane said: “They would postpone the MPC by one or two weeks! I don’t think it is something to panic about.

“In any case, what does the MPC do? Most of the changes in policy instruments have taken place outside the MPC meeting. So, the MPC has become a ritual. So, there is no need to panic.”

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via


Three Securities Shore Up NASD Market Capitalisation by N14.99bn



NASD Unlisted Securities Index

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange closed the final trading session of the week in positive territory as it gained 1.49 per cent at the close of business on Friday, June 2.

This growth was spurred by the upward price movement in the share prices of three companies admitted on the trading platform of the unlisted securities exchange.

FrieslandCampina Wamco Nigeria Plc rose by N4.80 to close at N75.00 per share compared with the preceding day’s N70.20 per share, Central Securities Clearing System (CSCS) Plc gained N1.12 to move up to N15.20 per unit from N14.08 per unit, while Acorn Petroleum Plc added 1 Kobo to close at 15 Kobo versus Thursday’s closing price of 14 Kobo.

The improvement in the prices of the above stocks pushed the market capitalisation of NASD higher by N14.99 billion to N1.023 trillion from N1.007 trillion, as the NASD Unlisted Securities Index (NSI) recorded a 10.84 points gain to wrap the session at 739.21 points compared with 728.37 points in the previous session.

The market witnessed a 15.6 per cent rise in the volume of securities traded by investors yesterday to 1.2 million units from the 1.0 million units transacted a day earlier.

However, the value of shares traded by the market participants decreased by 69.9 per cent to N56.9 million from N189.5 million, as the number of deals declined by 46.7 per cent to eight deals from the 15 deals carried out in the preceding day.

Geo-Fluids Plc closed the day as the most traded stock by volume (year-to-date) with 832.1 million units worth N1.3 billion, Industrial and General Insurance (IGI) Plc has traded 627.7 units valued at N49.4 million, and UBN Property Plc has exchanged 395.9 million units worth N336.6 million.

The most traded stock by value (year-to-date) was VFD Group Plc with 11.0 million units worth N2.5 billion, Geo-Fluids Plc has exchanged 832.1 million units valued at N1.3 billion, and FrieslandCampina Wamco Nigeria Plc has transacted 17.1 million units worth N1.2 billion.

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Naira Falls at P2P, Gains at Black Market, Stable at Official Market



Black Market

By Adedapo Adesanya

The Naira moved in different directions in the various segments of the foreign exchange (FX) market on Friday as traders await the merger of the exchange rates by the Central Bank of Nigeria (CBN) as directed by President Bola Tinubu.

Business Post reports that the Naira depreciated against the Dollar at the Peer-2-Peer (P2P) segment, appreciated in the black market, and remained unchanged in the Investors and Exporters (I&E) window.

In the P2P, the value of the local currency to the greenback fell by N9 to sell at N764/$1 compared with Thursday’s value of N755/$1.

At the parallel market, the domestic currency gained N3 against the greenback to sell at N747/$1, in contrast to the preceding session’s N750/$1.

However, in the official market, the Nigerian Naira maintained stability against the US Dollar to remain unchanged at N464.67/$1, as the forex turnover went down by 60.6 per cent or $152.08 million to $98.90 million from $250.98 million.

In the interbank segment, the Naira depreciated against the British Pound Sterling by 91 Kobo to close at N575.28/£1 versus the previous day’s N574.37/£1 and slumped by 12 Kobo against the Euro to sell at N493.70/€1 compared with Thursday’s N493.58/€1.

As for the digital currency, Bitcoin (BTC) jumped by 0.2 per cent to sell at $27,203.27, Ethereum (ETH) appreciated by 0.7 per cent to quote at $1,904.59, Cardano (ADA) added 1.4 per cent to its value to finish at $0.3774, Ripple (XRP) recorded a 1.3 per cent gain to quote at $0.5254, Dogecoin (DOGE) improved its value by 0.6 per cent to close at $0.0726, and Solana (SOL) made a 0.3 per cent rise to sell at $21.13.

On the flip side, Binance Coin (BNB) fell by 0.6 per cent to sell at $306.43, and Litecoin (LTC) followed with a 0.5 per cent loss to trade at $94.72, as the US Dollar Tether (USDT) and Binance USD (BUSD) remained unchanged at $1.00 each.

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Oil Closes 2% Higher Ahead Crucial OPEC+ Meeting



seven offshore oil blocks

By Adedapo Adesanya

Oil rose over 2 per cent on Friday after the United States Congress passed a debt ceiling deal that averted a government default in the world’s biggest oil consumer and jobs data fueled hopes for a possible pause in Federal Reserve interest rate hikes.

The focus is now on a meeting of the Organisation of the Petroleum Exporting Countries (OPEC) and its allies, OPEC+, this weekend.

Brent futures rose $1.85 or 2.5 per cent yesterday to $76.13 a barrel, while the US West Texas Intermediate (WTI) futures appreciated by $1.64 or 2.3 per cent to $71.74 a barrel, the highest since May 26 for WTI and May 29 for Brent, but for the week, both contracts were down about 1 per cent, their first in three weeks.

The US Senate approved a bipartisan deal to suspend the limit on the government debt ceiling, following approval in the House of Representatives, staving off a default that would have affected the markets.

Also, employment in the world’s largest economy increased more than expected in May, but a moderation in wages could allow the US Federal Reserve to skip a rate hike this month for the first time in more than a year, which could support oil demand.

However, a jump in the unemployment rate to 3.7 per cent from 3.4 per cent in the prior month, a slowing in the pace of hourly wage growth, and a decline in hours worked indicate that the US central bank may go ahead with expected moves.

Oil traders will watch the June 4 meeting of OPEC+. The group in April announced a surprise production cut of 1.16 million barrels per day, but resulting price gains have been erased, and crude is trading below pre-cut levels.

Reports showed that OPEC+ could also be debating an additional oil production cut among possible options.

According to Reuters, three OPEC+ sources said cuts were being discussed among options for Sunday. The sources said cuts could amount to 1 million barrels per day on top of existing cuts of 2 million barrels per day and voluntary cuts of 1.6 million barrels per day that were announced in a surprise move in April.

The oil ministers of the 23-nation alliance will gather at 2 p.m. in Vienna (1 p.m. Nigerian time). Before then, OPEC ministers will meet at 11 a.m. (10 a.m.) on Saturday.

On the demand side, manufacturing data out of China, the world’s second-biggest oil consumer, painted a mixed picture.

In the US, energy firms this week slashed the number of oil rigs operating by the most since September 2021, reducing the overall count for a fifth week in a row, energy services firm Baker Hughes Co. said.

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