By Francis Akinnodi

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Analysts are worried that the resurgence of the COVID-19, may erode economic recoveries, in third quarter of 2021.
They are also of the opinion that the surge in inflation rate in Advance and Emerging markets (AEs) may accelerate hawkish monetary policies, capable of triggering foreign exchange reversal from Nigeria and other emerging markets in fourth quarter of 2021.
Their statement came on the heels of the global spread of the Delta variant of the COVID-19 pandemic.
They implored the Monetary Policy Committee (MPC) of the CBN in its recent meeting to retain all policy parameters at current levels – MPR: 11.5%, Asymmetric Corridor around MPR: +100/-700bps, CR: 27.5%, and LR: 30.0% respectively as positive external development that boost Nigeria’s hope of improved exports earnings, foreign capital flows, and remittance in the second quarter and subsequent ones.
They told The Hope that for the fiscal and monetary authorities to improve macroeconomic environment to boost investors’ confidence, they would need all available tools to secure a dynamic, sustainable, and inclusive recovery.
An Economist at the Ado Ekiti University, Taiwo Owoeye said the global spread of the Delta variant of the COVID-19 pandemic coupled with the inflation rate in the US that hits 5.4% in June 2021, called for more concerns that all is not well with global economic recovery.
He said: “We consider these as worrisome development for the MPC, as a strong resurgence of the pandemic in Nigeria may erode recent recoveries, while the surge in inflation rate in AEs may accelerate hawkish monetary policies, capable of triggering FX reversal from Nigeria and other emerging markets.
“The country’s inflation has consistently stays above the tolerable zone for a very long time and most likely to still rise, though eased in the very recent.
“The COVID-19 second wave pandemic in the country will impede export which could be overcome through conscious programme of the government to improve outputs.
“Maintaining the monetary rate at the lowest level is the necessary conditions to support the growth of the economy. It is one thing making the policy, but also requires the policy guidelines to be put into use, on this basis and ensuring evenly financial conditions specifically for strategic sector and institutions.”
According to Elder Fessy Olabode, “The MPC must be resolute and disposable towards the conventional and unconventional means just as being proactive in approaches, similarly efficiently appropriation of liquidity, especially in deeply stressed economic areas or critical sectors may be most affected due to second wave pandemic.
“Considerably, a wider policy intervention in monetary, fiscal and sectoral is needed to take the economy back to growth path.
“Although the country has reactivated various measures to curtail the possible third wave of the pandemic, but we believe there is more to be done in rising above the tides and possible restriction measures.
“There is grave concerns around the macro and socio -economic activities huge impact of the third wave on ties of the country, as the Delta variant has a substantially increased rate of transmissibility compared with the previously dominant variants, however, the best known way of prevention is increasing the rate of vaccination as well as observance of the protocol measures.”
They noted that there is urgent need to improve macroeconomic environment to boost investors’ confidence, as this in the last four quarters have been hugely impacted negatively.
“Making foreign exchange available at cheap price for industries will stimulate production at this time in our nation building,” they submitted.