CBN retains benchmark interest rate at 11.5%, says it will aid economic growth

The monetary policy committee of the Central Bank of Nigeria (CBN) has announced its decision to maintain the monetary policy rate (MPR), which measures interest rate, at 11.5 percent.

Addressing journalists on Friday after the committee’s two-day meeting at the CBN headquarters in Abuja, Godwin Emefiele, governor of the apex bank, said the committee applauded the fifth decreased in inflation in the month of August 2021.

According to Emefiele, the committee unanimously voted to maintain the key lending rate at 11.5 percent, with the asymmetric corridor of +100 and -700 basis points around the MPR.

The CBN MPC noted that holding stance would allow current recovery in output and decline inflation continue.

It urged the fiscal authority not to relent in its infrastructure initiatives, including diaspora bonds to increase investment in critical infrastructure.

On Wednesday, the National Bureau of Statistics (NBS) said the consumer price index (CPI), which measures the rate of change in prices of goods and services, declined for the fifth consecutive time to 17.01 percent in August from 17.38 recorded in July.

This rate is 0.37 percent points lower than 17.38 percent recorded last month.

Since March 2021, Nigeria’s inflation rate has been on downward trends as the Central Bank of Nigeria (CBN) projected it may drop to 13 percent this year and a single-digit rate by 2022.

On exchange rates, Emefiele said the committee also applauded the banks on meeting forex demands and that all demands must be necessarily conducted at the Importer and Exporter (I&E) window to ensure stability.

He said operators must adhere to stipulated guidelines as the apex bank strive to eliminate illegal fx dealers in the country.