CBN Retains Lending Rate At 11.5%

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The Monetary Policy Committee of the Central Bank of Nigeria has retained the Monetary Policy Rate at 11.5 per cent.

The CBN Governor, Godwin Emefiele, disclosed this after the committee’s two-day meeting in Abuja on Tuesday.

It also retained the Cash Reserve Ratio and Liquidity Ratio at 27.5 per cent and 30 per cent respectively.

These rates are the rates the MPC maintained at its last meeting in November 2020.

Meanwhile, a financial expert, Mr Okechukwu Unegbu, has advised the committee to address rising inflationary rates.

Unegbu noted that other relevant rates remained stable and could be maintained.

At the last MPC meeting held in November 2020, key policy decisions reached include the benchmark interest rate which was held at 11 per cent.

Others include Cash Reserve Ratio at 27.50 per cent and Liquidity Ratio retained at 30.00 per cent.

“I guess that the MPC will leave the rates as they are because there appears to be some stability. The only issue is that inflation is going up, and it means that our currency is becoming weaker. What to do is to reduce the quantum of money in circulation,’’ he said.

He advised that the reserve requirement and liquidity ratio be adjusted to stabilise the economy.

The MPC is the highest policy-making committee of the CBN with the mandate to: Review economic and financial conditions in the economy and Determine the appropriate stance of policy in the short to medium term

Other mandates are to Review regularly, the CBN monetary policy framework and adopt changes when necessary, communicate monetary/financial policy decisions effectively to the public, and ensure the credibility of the model of transmission mechanism of monetary policy.

– Punch

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