Why We Left Interest Rate At 14%—Emefiele

By Modupe Gbadeyanka

Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has explained why the Monetary Policy Committee (MPC) retained all key indicators as against the many expectations of Nigerians.

The MPC met on Monday and Tuesday in Abuja to discuss important issues concerning Nigeria’s ailing economy.

At the end of the meeting, Mr Emefiele, who read the communiqué, announced that the benchmark Monetary Policy Rate would remain at 14 percent, while the Cash Reserve Ratio and Liquidity Ratio would stay at 22.50 percent and 30 percent respectively.

This comes after the Minister of Finance, Mrs Kemi Adeosun, had called on the CBN to review the interest rates downward so as to boost the economy.

But Mr Emefiele disagreed with her boss, saying cutting down the interest rate, which presently stays at 14%, cannot alone boost the country’s economy.

The CBN boss explained that “cutting interest rates is not advisable”, stressing that the “current stance will help to limit inflation.”

He said it was in the best interest of the country for the interest rate to be kept at 14 percent.

The rate was raised from 12 to 14 percent last July when the MPC held its meeting in Abuja.

The Nigerian government has been working hard to get the country out of recession.