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Debt, Inflation Affecting Global Growth – World Bank

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The two big problems facing global growth are debt and inflation, the World Bank said on Monday.

The President, David Malpass made the remark at Spring Meetings 2022 Media Roundtable.

He said due to high debt and deficit levels, countries are under severe financial stress with sixty per cent of low-income ones in debt distress or at high risk.

On steps to fix the situation, Malpass suggested the establishment of a timeline for forming creditors’ committees and suspension of debt service payments and penalty interest.

Others are expanding eligibility, using a simple rule so that it can be evaluated and enforced and engaging commercial creditors at the beginning of the process.

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On inflation, Malpass said policies need to be adjusted to enhance supply, not just increasing demand.

The chief urged governments and private sectors to ensure that supply will increase and that their policies will foster currency stability to bring down inflation and increase growth rates.

The World Bank advised Central Banks to use more tools under current policies.

“The inequality gap has widened materially, with wealth and income concentrating in narrow segments of the global population.

“Interest rate hikes, if that’s the primary tool, will add to the inequality challenge that the world is facing.

READ ALSO: Fuel Subsidy Puts Nigerian Economy At High Risk, World Bank Warns

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“Central banks can use more of their tools, not just interest rates. Capital is being misallocated now.”

The tools include: changing the duration of their portfolio as it would be helpful to shorten it; encouraging supply through their regulatory policies, and providing forward guidance that fosters currency stability.

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JUST IN: CBN Increases Interest Rate To 24.75%

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The Monetary Policy Committee of the Central Bank of Nigeria has today concluded its two-day meeting for March 2024.

This meeting marks the second MPC meeting for the year 2024 and also the 294th meeting of the CBN.

The MPC at the end of today’s meeting elected to hike the MPR by 200 basis points.

The Committee voted as follows: Raise the MPR by 200bps to 24.75 from 22.75 per cent
Increase the asymmetric corridor to +100bps/-300 basic points.

READ ALSO: JUST IN: CBN Sells Forex To BDCs At N1,251/$1

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Retain the Cash Reserve Ratio of Deposit Money Banks at 45 per cent and Adjust the CRR of Merchant banks from 10 per cent to 14 per cent.

The CBN retains a liquidity ratio of 13 per cent.

Details later…

 

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JUST IN: CBN Sells Forex To BDCs At N1,251/$1

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The Central Bank of Nigeria (CBN) has issued a circular to Bureau De Change (BDC) operators informing them that they sold $10,000 to each BDC at a rate of N1,251 per US dollar.

Nairametrics reports that the CBN, in a circular, instructed each BDC to sell the dollars to eligible customers at a rate not exceeding 1.5% above the purchase price.

READ ALSO:Tips For Online Registration Of Prospective Corps Members

It reads: “We refer to our letter to you referenced TED/DIR/CON/GOM/001/071 in respect of the above subject wherein the CB approved a second tranche of sale of FX to eligible BDCs.

“We write to inform you of the sale of $10,000 to each BDC at the rate of N1,251/$1. The BDCs are to sell to eligible end users at a spread of NOT MORE THAN 1.5 per cent above the purchase price.”

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Financial Institution Launches Indigenous Micro Insurance Software To Boost Customers Confidence

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The acting Managing Director, Prudent Choice Micro Insurance, Mrs. Gloria Onosolease, has said that the launch of its indigenous micro insurance software, named Insuretech, will help boost customers confidence and ensure accountability in the sector.

She disclosed this during the official launch of its Insuretech software in Benin.

Mrs. Onosolease said the achievement will significantly shape the nascent micro insurance landscape in Nigeria and indeed, across the African continent.

Onosolease said the newly developed software heralds a pivotal advancement in enhancing customer interaction and satisfaction, while concurrently optimizing their internal operations to foster efficiency.

She added that in a fiercely competitive industry such as insurance, embracing technology is indispensable to their continuous success and sustainability.

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READ ALSO: Tips For Online Registration Of Prospective Corps Members

She said that the micro insurance sector in Nigeria, particularly in Edo State, is undergoing a phase of unprecedented growth with a population exceeding five million people where a substantial portion of which is engaged in low income and medium sized enterprises spanning rural, urban and semi-urban areas.

She said due to this, there exists an urgent demand for accessible and inclusive insurance solutions but regrettably, this demographic has long been underserved and marginalized in terms of insurance protection.

She further said that with the launch of Insuretech, it will help mitigate the financial risks encountered by low income earners and small to medium scale enterprises.

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