Nigeria’s new central bank governor, Godwin Emefiele on Thursday said bringing down interest rates and keeping a stable exchange rate is at the top of his agenda, as he made his first public comments.
“We shall pursue a gradual reduction in interest rates,” Emefiele told journalists in the capital Abuja, two days after taking office at the Central Bank of Nigeria (CBN).
Interest rates in Africa’s biggest economy are currently running at 12.0 per cent and Emefiele, who previously headed Zenith Bank, said he aimed to bring it more into line with other emerging markets.
The bank would “pursue a reduction in both deposit and lending rates which would make it cheaper to invest,” he said.
But the local currency, the naira, has been under pressure in recent months, losing ground to the US dollar, which would normally argue for keeping interest rates high to keep the naira attractive.
Emefiele conceded that reducing interest rates and maintaining the exchange rate were “very daunting twin goals” but he added that the bank would “work assiduously (to)… ensure that these goals are mutually achieved.”
The new governor takes over from Sanusi Lamido Sanusi, who was suspended by the government in February for alleged financial recklessness and misconduct, charges that he denies.
The suspension came after the high-profile and outspoken Sanusi alleged that Nigeria’s state-run oil firm had misappropriated $20 billion in revenue, leading to claims that his ouster was politically motivated.
The CBN is legally independent of the government, but Sanusi has warned that his successor would have to guard against political interference.
Emefiele made no mention of Sanusi but said only that he would try to create a central bank that was “professional… apolitical and people-focused”.