CBN monetary committee leaves Nigerian interest rates unchanged at 11.5% % for now

CENTRAL Bank of Nigeria (CBN) officials have left interest rates unchanged at 11.5% for the time being saying that altering them either way would damage the economy and jeopardise the post-coronavirus recovery.

Like most other countries worldwide, Nigeria has felt the brunt of the global economic shutdown precipitated by the Covid-19 pandemic. This has had a significant impact on interest rates as some countries have cut them to bo9ost ending and others have raised them to increase government revenue.

Yesterday, however, the CBN's Monetary Policy Committee (MPC) decided to the leave the monetary policy rate (MPR) unchanged at 11.5%. CBN governor Godwin Emefiele, disclosed this after the committee’s two-day meeting in Abuja, adding that other parameters left unchanged include the cash reserve ratio (CRR) and liquidity ratio at 27.5% and 30% respectively.

Mr Emefiele said: “The MPC believes that the existing parameters have supported the growth recovery and should be allowed to continue for a little longer for consolidation to achieve the committee’s mandate of price stability conducive for growth. Therefore by unanimous vote, the MPC voted as follows, one, retain MPR at 11.5%, retain the asymmetric corridor of +100/-700 basis points around the MPR, retain the CRR at 27.5% and retain the liquidity ratio at 30%.

He noted that the committee believed that tightening or loosening the rates at this time would be unfavourable to the country’s economic recovery. Historically, Nigerian interest rates have always been high, which economists say have prohibited lending and stifled economic growth.