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Tuesday, 3 June 2014

Emefiele assumes duties as CBN governor

 The new Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele who formally assumed duties today, Thursday at the Headquarters of the apex bank in Abuja is to unveil his agenda at a World Press Conference on Thursday.

Emefiele, the tenth indigenous governor of the apex Bank who was cleared by the Senate on Wednesday, March 26, 2014, arrived at the CBN Headquarters at 7.30 a.m. on Tuesday, to the warm embrace of the four Deputy Governors at the Bank and expectant members of staff, led by Dr.Sarah Alade, whose tenure as Acting Governor ended on Monday, June 2, 2014.

A statement from the bank said the new governor at the brief formal handing over ceremony, thanked Alade and the other Deputy Governors for the stability in the bank.

The new CBN Governor, according to the statement is expected to hold a maiden World Press Conference on Thursday, June 5, 2014, where he will unveil his agenda for the bank and the people of Nigeria.

The immediate-past Group Managing Director of Zenith Bank Nigeria Plc, Emefiele brings along to his new role over 20 years of banking management experience.

Emefiele is a 1984 graduate of Finance and an MBA Degree in Finance in 1986, both from the University of Nigeria, Nsukka.

He is also an alumnus of Executive Education at Stanford University, Harvard University (2004) and Wharton Graduate School of Business (2005).

As Emefiele assumes office, he would be confronted with a lot of challenges such as the drop in fiscal buffers which had exposed the economy to vulnerabilities arising from both domestic and external shocks.

The erosion had accentuated the regime of persistently high interest rates as well as elevated demand for foreign exchange.

Following the depletion, the Monetary Policy Committee of the CBN had last month mandated the management of the apex bank to continue to monitor developments in the fiscal space with a view to taking appropriate monetary policy actions.

The country’s gross external reserves as at May 15, 2014 stood at $38.30bn compared with $37.40bn at end-March and $42.85bn at end-December 2013.

From the external environment, the prospects for increased yields and interest rates in the United States and the low level of economic activity in the emerging markets could have repercussions for foreign exchange inflows and stability of the naira exchange rate.

On the domestic front, the challenge of high banking system liquidity, elevated security concerns, anticipated high election-related spending in the run-up to the 2015 general elections are some of the key risks to the domestic economy.

For instance, the current high domestic liquidity could exert sustained pressure on both the exchange rate and consumer prices, as well as accentuate the already high demand for foreign exchange.

These, according to analysts could further deplete the country’s external reserves.

In addition, the core inflation had continued to send conflicting signals since January 2014 and if the upward trend continues as observed in April 2014, it could be a major factor in the upward trend in prices.

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