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Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has announced that the Nigerian economy is in a state of recession.

While addressing Senators in a closed-door meeting on Tuesday, Emefiele presented a lucid and comprehensive account on the situation of the economy and corrective measures that were being taken by the Federal Government, Vanguard reports.

During the one-hour session, the CBN governor who has come under some flak for some of his recent policies, attributed the economic woes to external shocks including the sharp decline in commodity prices, the geopoliticai tensions along important global trading routes, and tightening of Monetary Policy in the United States of America.

In a statement by the leadership of the Senate shortly after the meeting, the CBN governor was said to have drawn links between these occurrences and the Nigerian economy, especially with respect to the over 70 percent decline in oil prices from about S116 per barrel in June 2014 to about $30 per barrel earlier in the year.

According to the statement, “The Governor’s presentation also gave the Senators insight into the Bank’s decisions in the Foreign Exchange Market, and the rationale underlying the recent re-introduction of a Flexible Exchange Rate Mechanism in Nigeria.

“He also delved into the health of the financial system and discussed the Bank’s detailed examinations of financial institutions as well as its zero tolerance for insider dealings by Board and Management of deposit money banks. In sum, the Governor declared that the Strategic health of Nigeria’s financial system is still strong at this time.”

The CBN boss also reportedly told the senators that it was frightening that the nation was experiencing economic stagnation at the same time with inflation – an unhealthy situation referred to as Stagflation – as the two hardly overlap.

In a related development, the International Monetary Fund (IMF) slashed its growth forecast for the Nigerian economy this year, saying a combination of plunging oil revenues and weakened investor confidence will lead to a recession.

IMF said it expects Africa’s largest economy to contract by 1.8 percent this year, a situation that will slowdown economic growth across Sub-Saharan Africa this year.

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