The Monetary Policy Committee of the Central Bank of Nigeria yesterday rose from its two day meeting leaving rates unchanged for the seventh time in a row.
Only one member of the seven that attended the meeting voted for a cut in benchmark interest rate.
The decision to hold is in line with the expectations of most analysts who were optimistic that the committee will continue to hold rates to sustain its gains at the foreign exchange market and retain the inflow of foreign investors.
Godwin Emefiele, CBN governor, during a briefing following the meeting said loosening monetary policy at this time would exacerbate inflationary pressures and worsen the exchange rate and inflationary rate condition.
The apex bank left benchmark interest rate at 14 per cent, Cash Reserve Requirement at 22.5 per cent, Liquidity Ratio at 30 per cent and the asymmetric corridor at +200 and -500 basis points around the MPR.
The value of the naira had remained stable at N367 at the parallel market and N360 at the investors and exporters window.
The CBN had sold $195 million yesterday to boost liquidity at the forex market.
Inflation rate in the country has been on the decline dropping to 16.01 per cent in August strengthening the call by the real sector for a cut in benchmark interest rate but analysts warn that there might still be a rise in inflation.
Nigeria emerged from recession in the second quarter of this year, when Africa’s biggest economy expanded 0.55 per cent year-on-year after the economy shrank by 1.5 per cent in 2016, its first annual contraction in 25 years.
The recession was largely caused by low oil prices since the country relies on crude oil sales for around two-thirds of government revenue.
