As the Central Bank of Nigeria prepares to conclude its monetary policy committee meeting, analysts seem to agree that the apex bank would hold interest rate at 14%.
According to 10 analysts polled by PageOne.ng, the CBN is expected to maintain the rate but might likely reduce the cash reserve ratio for lenders.
In its last decision, the CBN said:
Only one member voted to raise the MPR
(i) Retain the MPR at 14 per cent;
(ii) Retain the CRR at 22.5 percent; 17
(iii) Retain the Liquidity Ratio at 30.00 per cent; and
(iv) Retain the Asymmetric corridor at +200 and -500 basis points around the MPR
Should that scenario play out, it is a sign that Nigeria’s economy still needs some conservative treatment. Inflation only slowed down to 17.24% based on the last data released by the National Bureau of Statistics, NBS. The NBS noted that food prices are still maintaining higher prices, the CBN would need to hold rates as a cut in rate would spike inflation.
Anslysts suggest that the recent ease of accessing Forex should be sustained to ensure prices are downwardly adjusted in order to have significant effect on inflation.