CBN retains benchmark interest rate at 11.5%

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN)has retained the Monetary Policy Rate (MPR) at 11.5 per cent for the umpteenth on Tuesday.

Reading a statement after the committee’s 282nd meeting on Tuesday, Godwin Emefiele, the CBN governor, said the MPC also unanimously agreed to hold all other monetary policy parameters constant.

The Asymmetric Corridor thus remained at +100 and -700 basis points around the MPR, the Reserved Cash Ratio (CRR) at 27.5% and the Liquidity Ratio at 30%.

Emefiele said that the parameters to sustain the growth of the economy were maintained.

“At this meeting, MPC was pleased that its policy actions in the past had started to produce positive results through a notable improvement in the Gross Domestic Product, which stood at 4.03 per cent during the third quarter of 2021.

“There was also the sixth consecutive month of moderation in inflation to 15.99 per cent in October.

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“Given the level of its conviction about the effectiveness of its actions on macroeconomic variables, MPC considered that the tightening could increase the cost of funds and restrict growth, while the relaxation could aggravate the distortion in the money market.

“The MPC believes that the existing monetary policy stance has supported economic growth and recovery and should be allowed to continue for a little longer for consolidation,” he said.

Emefiele added that the consolidation would allow the MPC to carry out its mandate of price stability that is conducive to growth.

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“The committee also feels that the old stance will allow it to carefully access the implications of global developments that are unfolding around deepening policies and normalizing economies,” Emefiele said.

With the above in mind, he added that the committee decided to hold all policy parameters constant to support the environment conducive to the sustained growth of the Nigerian economy. (NAN)