CBN Committee Retains Benchmark Interest Rate At 11.5%

The Central Bank of Nigeria’s Monetary Policy Committee on Tuesday retained the Monetary Policy Rate (MPR) at 11.5% and kept all other parameters unchanged.

CBN Governor Godwin Emefiele made the announcement while addressing journalists at the bank’s headquarters in Abuja.

The MPR, which has remained unchanged for months, is a powerful tool for regulating interest rates in the economy.

Lowering the rate could have stimulated more borrowing while raising the rate could have signaled the CBN’s intention to reduce the economy’s money supply.

Other parameters left unchanged are the Cash Reserve Ratio and Liquidity Ratio at 27.5 per cent and 30 per cent respectively.

Announcing the committee’s decision, Emefiele said, “After a careful balancing of the benefits and the downside risks of the policy options, the MPC decided to hold all parameters constant, believing that a whole stance will enable the continuous permeation of current policy measures in supporting the recorded growth recovery and further boost production and productivity which will ultimately rein in inflation in the short to medium term.

“The MPC thus decided by a unanimous vote, the MPC voted as follows, one, retain MPR at 11.5 per cent; retain the asymmetric corridor of +100/-700 basis points around the MPR; retain the CRR at 27.5 per cent; and retain the Liquidity Ratio at 30 per cent.”