The decision of the Central Bank of Nigeria’s Monetary Policy Committee retained the benchmark lending rate at 14 per cent seems to have worsen the situation of the naira further as it now exchange for a dollar at 428 in the parallel market yesterday down from 424 on Tuesday.
The MPC had risen from its two-day bi-monthly meeting and left the Monetary Policy Rate unchanged, contrary to calls for its reduction by analysts, stakeholders and some government officials, including the Minister of Finance, Mrs. Kemi Adeosun.
At the interbank official market, the local currency dropped to 310.08 on Wednesday, down from 307.25 on Tuesday, according to data on the FMDQ OTC platform.
Some analysts believe the decline in the value of the naira has nothing to do with the MPC decision to leave the lending rate unchanged. They said the decline in the value of the naira against the US currency would have been more significant if the MPC had announced a cut in the MPR on Tuesday.
The Director, Monetary Policy, CBN, Mr. Moses Tule, told Channels TV that it’s not sufficient for the monetary policy committee to just meet and say we are reducing interest rates to address a stagflation. He said policymakers would need to act together on fiscal, monetary and trade policies to jump-start economic growth.
