CBN, MPC retains interest rates at record high to stabilise naira gain

The Central Bank of Nigeria’s Monetary Policy Committee, MPC, Tuesday voted to retain key interest rate at a record 14 percent even as it seeks a convergence in the Country’s foreign exchange market.

The apex bank governor, Godwin Emefiele said at the end of their meeting in Abuja that members voted unanimously to keep the rate at current figures.

Emefiele stated that the committee decided to keep the key interest rate at 14 percent, cash reserve ratio (CRR) at 22.5 percent and liquidity ratio at 30 percent.

He said, “The MPC was of the view that whereas the downward trend in inflation is a welcome development, the rate was still significantly above the policy reference band.”

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“Committee is particularly with the gradual retreat in inflation, the relative stability in the naira exchange rate across all segments of the market and the improved prospect of foreign inflows.

“The monetary policy committee this is intended to allow the existing policies to achieve their goals and objectives.

“The committee was also concerned that loosening will exacerbate inflationary pressure and worsen the gains so far achieved in the exchange rate of the naira. It was also convinced that loosening will further increase the negative interest rate.”