The Central Bank of Nigeria (CBN) on Tuesday reinforced its commitment to taming inflation and preserving exchange rate stability by leaving its benchmark interest rate unchanged at 26.5 percent, a move analyst said reflects caution despite easing price pressures.
At the end of its two-day Monetary Policy Committee (MPC) meeting in Abuja, Olayemi Cardoso, governor of the CBN said the committee unanimously voted to retain the Monetary Policy Rate (MPR) at 26.5 percent.
It also retained the asymmetric corridor around the MPR at +50/-450 basis points, the Cash Reserve Ratio (CRR) for Deposit Money Banks at 45.0 percent, the CRR for Merchant Banks at 16.0 percent, the 75 percent CRR on Non-TSA public sector deposits, and the liquidity ratio at 30.0 percent.
He said maintaining the current policy stance followed a thorough assessment of the balance of risks to the Nigerian economy.
The decision was widely expected by economists, who had predicted the CBN would maintain its tight monetary stance as inflation, though easing, remains vulnerable to domestic and global risks. It reflects the Bank’s commitment to sustaining the moderation in inflation, preserving exchange rate stability, and consolidating the gains from recent macroeconomic reforms amid heightened geopolitical uncertainties, particularly in the Middle East, which continue to pose upside risks to energy prices and inflation.
