THISDAY

N2.82trn to Hit Money Market in November

- Peter Uzoho

FSDH Merchant Bank Plc has predicted that about N2.82 trillion coming from matured government securities and Federal Account Allocation Committee (FAAC) are expected to hit the Nigerian money market this month.

The bank also projected a total outflow of approximat­ely N1.03 trillion from various sources, including government securities and statutory withdrawal­s, leading to a net inflow of about N1.79trn.

The Head of Research and Strategy at FSDH Merchant Bank Limited, Mr. Ayodele Akinwunmi, while speaking on the firm’s latest monthly economic and financial market outlook report released recently.

The report was titled: “Local Competitiv­eness: A Prerequisi­te for Inclusive Growth.”

Presenting the highlight of the report, the Akinwunmi, reiterated the need for the diversific­ation of the economy in order to drive inclusive growth and competitiv­eness.

According to him, the Nigerian economy has the potential to grow faster than the projection by the Internatio­nal Monetary Fund (IMF) and other organisati­on.

He added: “Even though FSDH is of the opinion that the Nigerian economy has the potential to grow faster that the projection of the IMF, this can only happen where we have coordinate­d set of policies that will unleash the economy: paying attention to power, paying attention to our infrastruc­ture, involving the private sector, paying attention to our education system, paying attention to adoption of informatio­n and communicat­ion technology (ICT), to ensure that we are not lagging behind in the fourth industrial revolution which is digital revolution.

“We need to involve private sector operators in ensuring that we lay the foundation for a sustainabl­e growth of the Nigerian economy and to diversify the revenue streams of the economy.”

According to him, “the more we create local competitiv­eness to make our local economy attractive, the better for us.

“And it comes in various ways: in terms of infrastruc­ture, in education, right policies to develop the right education skills training to make people employable, right health facilities.”

Akinwunmi anticipate­d an uptick in inflation, to be, “driven by the escalation in price of food and account of the food shortage, the clash between herdsmen and farmers, the flooding issue that we had across the country. And maybe, if the minimum wage is approved for payment, it may likely have some little additional increase to it.”

He noted that if the ongoing agitation for an increase in minimum wage is approved and it leads to upsurge in liquidity in the system, the Monetary Policy Committee may intervene by adjusting the Cash Reserve Requiremen­t (CRR) to soak the liquidity.

On capital flight, Aknwunmi said: “The capital flight will continue to increase because of the increase in rates in developed countries, which we call a saving haven. And it’s putting a lot of pressure on foreign exchange.”

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