Some economists have said the retention of the Monetary Policy Rate (MPR) at 11.5 per cent by the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) was anticipated.
The experts said this in separate interviews after the result of the MPC meeting was announced on Tuesday in Abuja.
The CBN Governor, Godwin Emefiele, had announced that the committee also unanimously agreed to retain all other monetary policy parameters.
The Cash Reserved Ratio (CRR) was, thus, retained at 27.5 per cent, Liquidity Ratio, 30 per cent and Assymetric Corridor, +100 and -700 Basis Points around the MPR.
Emefiele said the committee members agreed that changing the rates at this time was not desirable as it could worsen inflation and reverse recent economic gains.
Akpan Ekpo, a Professor of Economics and Public Policy at the University of Uyo, Akwa Ibom, said that he expected that the MPC would retain the rate and other parameters.
“I am not surprised because I had said the MPC should allow fiscal policy to drive the economy. It is too early in the year to tinker with the existing rates.
“The increase in inflation is marginal. The MPR has no impact on lending rates for now.
“The macroeconomic fundamentals are moving in the wrong direction except the growth in GDP. Inflation is trending upwards especially food inflation and this may be due to spending during the holidays; hence it may be too soon to tinker with the interest rate,” he said.
Sheriffdeen Tella, Professor of Economics at the Olabisi Onabanjo University, Ago-Iwoye, Ogun State, also said he did not expect any change.
“I wasn’t expecting any change because the year is just starting and even globally, there is not much activities that would warrant changes in policies.
“However, MPR at 11.5 per cent is rather high for an economy with infrastructure deficiency, particularly electricity, resulting in high cost of production and lack of global competitiveness,” he said.
