Nigeria's central bank keeps interest rate at 14%

All the eleven members of the Monetary Policy Committee (MPC) unanimously agreed to retain the Monetary Policy Rate (MPR) at 14%.

Godwin Emefiele, CBN governor

The rates were first raised in July 2016 to combat rising inflation.

The CBN monetary policy committee (MPC) made the decision at the end of its 264th Meeting in Abuja on Thursday, November 22, 2018.

At its meeting, all the eleven members of the Monetary Policy Committee (MPC) unanimously agreed to retain the Monetary Policy Rate (MPR) at 14%.

Godwin Emefiele, CBN Governor, said the asymmetric corridor remained unchanged at +200 and -500 basis points around the MPR, while the CRR is retained at 22.5%, with the liquidity ratio at 30%.

He said by holding its constant, the committee has confidence in policies deplored by the apex bank over stability in foreign reserves and forex sustainability.

Ayo Teriba, an economist, in an interview with Inspiration Fm On Thursday said the decision to hold the rate is a good move at this time.

Analysts at FSDH and Afrinvest had earlier predicted that the monetary authority will delay any decision on rates till January 2019 meeting.

Nigeria’s inflation rate drops marginally in October

The CBN has been holding the key lending rate since 2016 when Nigeria entered into its worst economic recession in 25 years amid global oil price slump and the troubled naira.

The committee believed that the decision is consistent with achieving the single-digit inflation target rate.

On Wednesday, data from the National Bureau of Statistics showed that inflation rate dropped to 11.26% in October compared to 11.28% recorded in September, the first decline after two consecutive month-month rises in 2018.

But Teriba said the drop in the inflation figure for October is insignificant as the drop is very low. He said it doesn't change the trend of thing and until the inflation rate dropped significantly Nigerians may not feel the impact.

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