Nigeria retains lending rate at 14% despite rise in inflation

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) kept the benchmark interest rate unchanged at 14 percent, CBN Governor Godwin Emefiele told reporters on Tuesday in Abuja.

With inflation rising for the first time in 18 months in August, analysts who spoke to The Nerve Africa ahead of the MPC meeting predicted that the MPC would hold rates so as not to “rock the boat”, as one of our respondents put it.

In its second to the last meeting of the year, the MPC held rates at the same level it has been since 2016, hoping to succeed in stemming inflation which has been outside target band of 6 percent to 9 percent since 2015.

Seven members of the committee voted to keep rates unchanged, while three voted in favour of a 25 basis-point increase.

The committee also retained the Cash Reserves Ratio at 22.5 per cent and Liquidity Ratio at 30 per cent.

On Monday, the Bank of Ghana also maintained its policy interest rate at 17 percent on Monday, with the central bank Governor Ernest Addison saying the Bank made the decision mindful of possible inflationary headwinds.