By Shola Akingboye – 28th, May 2020
The Monetary Policy Committee of the Central Bank of Nigeria on Thursday reduced the Monetary Policy Rate or the controlling lending rate to 12.5 per cent as the benchmark interest rate, from 13.5 percent, to cushion the effect of the impending economic recession that may arise from the impacts of the COVID-19, pandemic.
RegentAfrica Times recalls that the committee had retained the MPR at 13.5 per cent at the last MPC meeting in March; it however, left other monetary policy parameters unchanged, such as the retention of the Cash Reserve Ratio (CRR) and the Liquidity Ratio (LR) at 27.5 percent and 30 percent, respectively. This includes the Asymmetric band at plus 200 basis points and minus 500 basis points around the MPR.
Reading the communique at the end of its virtual 273rd meeting, the CBN Governor, Mr Godwin Emefiele, said that seven members of the committee voted to cut the MPR by 100 basis points, while two members voted for a 150bps rate cut, with one member electing for a 200bps rate cut.