The Central Bank of Nigeria, CBN, has retained the Monetary Policy Rate, MPR, at 26.5 percent as part of efforts to sustain macroeconomic ility and manage inflationary pressures in the country.
The decision was announced by the Governor of the CBN, Olayemi Cardoso, after the conclusion of the 305th Monetary Policy Committee, MPC, meeting held in Abuja. Other key monetary parameters were also left unced.
According to Cardoso, the Standing Facility Corridor around the MPR remains at plus 50 and minus 450 basis points, while the Cash Reserve Requirement, CRR, was retained at 45 percent for deposit money banks, 16 percent for merchant banks and 75 percent for non Treasury Single Account public sector deposits.
The CBN governor explained that the MPC’s decision was based on a careful assessment of economic conditions and external risks affecting the Nigerian economy. He noted that although inflation had increased slightly for two consecutive months, the rise was largely linked to temporary external shocks, especially tensions in the Middle East that affected global energy and transportation costs.
Cardoso said previous economic reforms introduced by the monetary and fiscal authorities helped reduce the impact of these global shocks on Nigeria’s economy. He cited exce rate ility, improved foreign reserves, stronger monetary policy transmission and ongoing fiscal consolidation as factors strengthening the country’s economic resilience.
The CBN also disclosed that Nigeria’s foreign reserves had risen to about 49.49 billion dollars, close to the level recorded before the Middle East crisis. According to Cardoso, the reserve level is strong enough to cover about nine months of imports, which is expected to boost investor confidence.
On the foreign exce market, the CBN governor stated that the apex bank was no longer intervening directly in the market, insisting that the FX market had become deep and le enough to operate independently.
He further assured that the CBN would continue monitoring the banking sector following the ongoing recapitalisation exercise to ensure financial system ility and manage any emerging risks.
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