The Monetary Policy Committee of the Central Bank of Nigeria has announced the retention of the Monetary Policy Rate at 14 per cent.
The monetary policy is the process by which the monetary authority of a country, typically the central bank or currency board, controls either the cost of very short-term borrowing or the monetary base, often targeting an inflation rate or interest rate to ensure price stability and general trust in the currency.
The Governor of Central Bank of Nigeria, Godwin Emefiele, announced the decision of the committee at the end of a two-day meeting held at the apex bank’s headquarters in Abuja, saying that the committee thought that the drop in inflation is seasonal and not sustainable.
Emefiele said the upside risk to inflation still remains. All 11 members of the committee voted to hold rates.
He explained that all the 11 members of the committee that attended the meeting agreed to maintain the current monetary policy stance
He said apart from the MPR which was retained at 14 per cent, the committee also retained the Cash Reserves Ratio at 22.5 per cent.
Also retained are the Liquidity Ratio, which was left at 30 per cent; and the Asymmetric Window, which was left at +200 and -500 basis points around the MPR.