MPC again refuses to reduce interest rate, retains it at 14%

Again, expectations of experts that Nigeria’s benchmark interest rate would drastically come down has been dashed, as the CBN-led Monetary Policy Commiittee (MPC) rose from its Tuesday’s meeting for the month of May 2017, retaining a double digit figure for the rate of borrowing money from banks.

The CBN Governor, Godwin Emefiele told journalists, after the MPC meeting, that tampering with the prevailing rate would send lots of distortions in the gradual, but steady recovery of the economy, given that the benchmark self-adjusts.

He said that all members of the Commiittee had voted to retain the prevailing rate 14 at per cent

He said the apex bank is working towards closing the wide gap between the black market and official foreign exchange rates.

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According to him that has justified the recent rise of the naira versus the dollar as indication of succuss of the policy of the central bank in returning the forex to an appreciable strand.

Hear him: “We would prefer a convergence that will go southward rather than northward, but the fact that we have seen the convergence moving southward gives us a lot of hope that things are working in the right direction.”

He acknowledged the fact that there were still some challenges weighing down the economy, given the statistics from the NBS on Tuesday, which shows that Nigeria’s Gross Domestic Product, in the first quarter of 2017, suffered a 0.52 per cent shrink.

On what should be the maximum exchange rate acceptable to CBN, Emefiele declined making any predication on that.

 

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