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Monetary Policy

Mandate | Fiscal Policy | Conduct of MPC | Committees | Educational | FAQ's
Policy Decisions | Policy Communiqués | Intl. Economic Cooperations

Monetary Policy Committees

Monetary Policy Committees are:-

1. Monetary Policy Committee (MPC)
2. Monetary Policy Technical Committee (MPTC)
3. Monetary Policy Implementation Committee (MPIC)
4. Monetary Policy Forum

Monetary Policy Committee (MPC)

Composition

1. Governor - Chairman
2. Deputy Governor (Operations) - Member
3. Deputy Governor (Corporate Services) - Member
4. Deputy Governor (Financial Sector Surveillance) - Member
5. Deputy Governor (Economic Policy) - Member
6. Prof. S. O. Olofin (Board Member) - Member
7. Prof. A. H. Ekpo (Board Member) - Member
8. Permanent Secretary – Federal Ministry of Finance (Board Member) - Member
9. Director, Banking Supervision - Member
10. Director, Trade & Exchange - Member
11. Director, Foreign Operations - Member
12. Director, Banking Operations - Member
13. Director, Monetary Policy - Member
14. Director, Research & Statistics - Member
15. Deputy Director, MPC Secretariat, MPD - Secretary
16. Also, in attendance are; the Economic Adviser to the President and
17. the Director-General, Budget Office, Federal Ministry of Finance.

Monetary Policy Committee Reconstituted

Following the passage of the new Central Bank of Nigeria Act (2007) into law by the National Assembly, the Monetary Policy Committee has been reconstituted.

Section 12

1.  of the CBN Act (2007) states inter alia:
   In order to facilitate the attainment of the objective of price stability and to support the economic policy of the Federal Government, there shall be a Committee of the Bank known as the Monetary Policy Committee (in this Act referred to as “the MPC”).



2. The MPC shall consist of:
   
   
   • The Governor of the Bank who shall be the Chairman;
     
   • The four Deputy Governors of the Bank;
   • Two members of the Board of Directors of the Bank;
   • Three members appointed by the President
   • Two members appointed by the Governor
   
   
3. the MPC shall have responsibility within the Bank for formulating monetary and credit policy.
   

Functions
The Monetary Policy Committee is the highest policy making committee of the Bank with the following mandate:

• Review economic and financial conditions in the economy
• Determine appropriate stance of policy in the short to medium term
• Review regularly, the CBN monetary policy framework and adopt changes when necessary.
• Also communicate monetary/financial policy decisions effectively to the public and ensure the credibility of the model of transmission mechanism of monetary policy.

Meetings
The MPC meets quarterly, except otherwise, in the event of an emergency.

Monetary Policy Tech. Committee (MPTC)

Composition

1. Director, Research & Statistics - Chairman
2. Director, Trade & Exchange - Member
3. Director, Banking Supervision - Member
4. Director, Foreign Operations - Member
5. Director, Banking Operations - Member
6. Director, Other Financial Institutions - Member
7. Director, Monetary Policy - Member

Functions

• To consolidate the inputs of the various Department on monetary issues
• Review the technical soundness of monetary policy recommendations for the MPC.
• Review international and domestic economic developments and their likely impact on the Central Bank of Nigeria’s ability to achieve and monitor domestic price stability.

Meetings
The MPTC meets to review the economic outlook and other presentations of importance from the various departments one week before the meeting of the Monetary Policy Committee. The MPTC formally meets once every quarter in the year.

Monetary Policy Implementation Committee (MPIC)

The Monetary Policy Implementation Committee (MPIC) was established at the 192nd meeting of the Monetary Policy Committee (MPC) on 25th October, 2005. At inception, the membership of the Committee included the Deputy Governor (Economic Policy) as the Chairman, the Directors of Research & Statistics and Banking Operations Departments. The Monetary Policy Committee Secretariat which later in November, 2005, formed part of the new Monetary Policy Department serves as the Secretariat.

At its second meeting on 31/10/05, the membership was expanded to include the Directors of Banking Supervision, Trade &Exchange and Information Technology Departments. Also, at its 10th meeting, the MPIC decided that the Director, Currency and Branch Operations Department be invited to guide the Committee on decisions and developments affecting currency in circulation. The Director of Finance Department was later invited to join the committee.

Composition

1. Deputy Governor (Economic Policy) - Chairman
2. Director, Monetary Policy Department - Member
3. Director, Research and Statistics Department - Member
4. Director, Banking Operations Department - Member
5. Director, Finance Department - Member
6. Director, Trade & Exchange Department - Member
7. Director, Banking Supervision - Member
8. Director, Currency and Branch Operations Department - Member
9. Director, Information Technology Department - Member
10. Special Adviser to the Governor (Economic Matters) - Member

Functions
The mandates of the MPIC include:

• Determining/projecting the daily injection/withdrawal of liquidity through the CBN
• Forecasting the daily liquidity gap
• Designing the strategy for closing the liquidity gap
• Identifying specific instruments to be used in closing the liquidity gap

Meetings
The MPIC holds its meeting every other day to advice the Governor on how to achieve the broad money (M2) target. The inaugural meeting was held on 27th October, 2005. Since then, the MPIC has been meeting regularly.

Read Frequently Asked Questions (FAQs) on Monetary Policy