Monetary sector policy, Financial sector policy, Foreign exchange.


The objective of this paper is to review the monetary and other financial sector policy measures in 2004, with a view to identifying how they assist in achieving the macroeconomic objectives of the government in fiscal 2004. This paper evaluates the financial sector and the macroeconomic developments during fiscal 2003. It examines the monetary and other financial sector policies in 2004. A good monetary policy is expected to achieve macro economic stability and a sound financial sector if effectively implemented and barring fiscal shocks. Overall, socio-political stability and fiscal discipline are critical factors for the effectiveness of monetary policy. The efficacy of monetary policy in Nigeria has continued to be constrained by fiscal shocks. Inconsistent policy pronouncements from the political leadership can also undermine monetary policy because of the wrong signals which it sends to economic agents. The structure of the financial system is also crucial for the successful implementation of monetary policy measures. The enduring oligopolistic structure of the banking system has continued to sustain the problem of wide spread between banks deposit and lending rates.

Author Bio

The author is a staff of Central Bank of Nigeria.

Publication Title

CBN Bullion







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