Amid public expectations that the Central Bank of Nigeria (CBN), through its Monetary Policy Committee (MPC), would decide on key monetary policy rates to tame the surging inflation rate in the country at the end of the committee’s 2-day meeting tomorrow in Abuja, the apex bank on Monday announcement the I indefinite postponement of the meeting.
The meeting, early scheduled for Monday and Tuesday, November 20 and 21, has again been postponed for the second time since Dr. Olayemi Cardoso became the governor of the apex court in September.
The CBN’s Director of Corporate Communications, Dr Isa Abdulmumin, who gave this hint in a text message, confirmed that “MPC is not holding”.
Analysts had anticipated that the MPC would sustain its hawkish monetary policy stance at the meeting, with majority believing that the apex bank would jack up the MPR, the benchmark lending rate by at least 400 basis points at the end of the meeting.
For instance, a Bloomberg survey of 12 economists had projected the apex bank would raise its benchmark rate by as much as 325 basis points from the 18.75% it set at its last meeting.
The CBN had last week projected that current inflationary pressures may continue in the near term based on the prevailing micro and macroeconomic indices of the economy
The apex bank, in its just published second quarter ‘Economic Outlook’ report, primarily linked its projection on the general price level in the economy to the removal of fuel subsidy, depreciation of the Naira, anticipated upward review of wages and electricity tariffs, and negative effects of climate change on agricultural activities were likely to sustain the increased inflation in the near term.
It clarified: “Inflationary pressures may subsist in the near-term on account of the removal of fuel subsidies and subsequent higher prices of premium motor spirit, and the depreciation of the naira.
“Moreover, the anticipated upward review of wages and electricity tariffs, alongside the adverse effects of climate change on agricultural output, are likely to induce further inflationary pressures”, it added.
However, the apex bank expressed optimism that tight monetary policies and improvement in global supply chains would help dampen the inflation rate in the future.
Meanwhile, the National Bureau of Statistics (NBS), had last Wednesday reported that Nigeria’s inflation rate increased to 27.33% in October this year, representing 0.61% increase over the rate recorded in the preceding month and the highest rate in 18 years in the economy.
Largely, the Bureau attributed the latest surge in the Consumer Price Index (CPI) to surging food prices which peaked at 31.52% in October, from the 30.64% recorded in September this year.