The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has retained the Monetary Policy Rate (MPR) at 13.5 per cent while other policy parameters remained unchanged.
The Governor of the CBN, Mr Godwin Emefiele, made this known after the MPC’s meeting in Abuja on Tuesday.
Emefiele disclosed that all the 11 members of the committee attended the meeting and they unanimously voted for the decision.
He said the committee also retained Cash Reserve Ratio (CRR) at 22.5 per cent and the Liquidity Ratio at 30 per cent.
The CBN said that the MPC also retained the Asymmetric Corridors at +200 and -500 basis points around the MPR, stressing that the committee reviewed the upside and downside on the option to tighten, loosen or hold.
Emefiele said while tightening might encourage capital flow, it also had downside consequences of tightening the already nascent recovery outlook growth.
He said that the MPC noted that the reduction in the policy rate would improve growth prospects but in view of optic inflationary pressure, decided that the balance of the risk was in favour of protecting price stability.
According to him, considering the recovery decline in market interest rate growth in domestic, the committee feels there will be more gains in shortfall to medium term.
He further explained that in holding policy at the current position, the committee noted with pleasure the positive outcome of action already taken by the bank.
Emefiele enumerated the steps taken by CBN in this direction to include policy on loan to deposit ratio which had resulted in loans advancing and rising by N1.1 trillion between June and October.
He said this action had assisted the agriculture and manufacturing sectors hence the positive outcome on the GDP.