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Nigeria Central Bank's Acting as Piggy Bank, MPC Member Says

  • CBN claims on the government rose twentyfold in 2017: Salami
  • Salami says central bank is crowding out the private sector
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Nigeria’s central bank is acting like a “piggy bank” with its funding of the government, according to a member of the Monetary Policy Committee who said he struggles to understand the regulator’s economic rationale.

Monetary data showed a “sharp rise” in the Central Bank of Nigeria’s financing of the government deficit this year, Doyin Salami said after the MPC’s July 24-25 meeting, according to a central bank statement published Tuesday. The regulator’s claims on the government had risen “twenty-fold” to 814 billion naira ($2.26 billion) from the end of 2016, while its purchases of government T-bills increased 30 percent to 454 billion naira, he said.