The Monetary Policy Committee, MPR, of the Central Bank of Nigeria, CBN, has voted to retain the monetary policy rate at 11.5 per cent.
The apex bank governor, Godwin Emefiele, announced the committee’s decision at the end of a two-day meeting at the CBN headquarters in Abuja on Tuesday.
The committee also retained the liquidity ratio at 30 per cent and Cash Reserve Ratio (CRR) at 27.5 per cent.
The bank also disclosed that the nation’s economic recovery is “still fragile”.
Figures from the recently released Q1 2021 GDP report show that the Nigerian economy grew 0.51 percent within the period from 0.11 percent in Q4 2020 — riding on the back of improved oil recovery.
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The non-oil sector accounted for 90.75 percent of aggregate GDP in the first quarter of 2021, higher than its share in the first quarter of 2020, which was 90.50 percent, but lower than 94.13 percent recorded in the fourth quarter of 2020.
On the other hand, oil production rose to 1.72 million barrels per day in the first quarter from 1.56 million in the last quarter of 2020. This is lower than the average daily production of 2.07mbpd prior coronavirus pandemic period.
Emefiele said that increasing the MPR will increase the cost of borrowing and reduce access to credit for businesses which he said might reverse the growth trend of the economy.
He also appealed to bandits in the forest to drop their arms and “embrace the anchor borrowers’ programme.”