The Central Bank of Nigeria (CBN) has retained all the key monetary policy rates, including the Monetary Policy Rate (MPR) at 26.50%, as part of its sustained efforts to consolidate on the modest achievements of its ongoing monetary policy initiatives in the country.
The governor of the apex bank, Olayemi Cardoso, announced at the end of the Monetary Policy Committee (MPC) committee’s 305th meeting in Abuja today that members agreed to retain the benchmark lending rate in view of the pressures on the domestic economy from the global economic whirlwinds, among other factors.
Specifically, the banker confirmed that the MPC retained the Monetary Policy Rate (MPR), the benchmark lending rate, at 26.50%, and the asymmetric corridor around the MPR was retained at +50/-450bps.
Similarly, the MPC left the Cash Reserve Ratio (CRR) for Deposit Money Banks and Merchant Banks unchanged at 45.00% and 16.00%, respectively while the 75% CRR on Non-TSA public sector deposits was also retained.
- Advertisement -
Economists and other experts have in the past few days been expressing their concerns about the micro and macroeconomic indices in the economy and urged the apex bank to ensure that decisions taken during the MPC’s meeting help in moderating the headline inflation in the economy in order to support businesses and lessen the burden of rising costs of living on ordinary Nigerians.
For instance, the Director/Chief Executive of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, had on Monday charged the monetary authorities to carefully calibrate and balance its monetary policy stance in order to ensure the nation’s macroeconomic stability.
Yusuf advised that the committee’s decisions at its meeting should avoid excessive tightening capable of undermining economic recovery and private sector resilience.
The CPPE boss canvassed: “The overarching policy priority should be to sustain investor confidence, support productive investments, stimulate output growth and strengthen the economy’s supply-side capacity while maintaining vigilance on inflation management.
“In the final analysis, while prevailing inflationary risks may justify a cautious policy posture by the MPC, the CPPE strongly urges the monetary authorities to avoid excessive reliance on monetary policy orthodoxy in managing what is fundamentally a structurally-driven inflation environment.
“Sustainable disinflation in Nigeria will depend far more on improvements in productivity, energy security, logistics efficiency, exchange rate stability, domestic petroleum refining capacity and overall supply-side reforms than on aggressive monetary tightening”, Yusuf added.
