Nigeria Monetary Policy


Nigeria: Central Bank of Nigeria keeps rates unchanged in September

September 22, 2015

At its 21–22 September monetary policy meeting, the members of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) voted unanimously to keep the monetary policy rate unchanged at 13.00% with a corridor of plus/minus 200 basis points around the midpoint. The decision was in line with market analysts’ expectations. Moreover, the Bank decided to cut the cash reserve requirement (CRR) by 600 basis points to 25%.

In its September assessment of the economy, the CBN stated that the global economy is showing diverging trends. While developed economies are growing at a gradual but steady pace, emerging-market economies are performing poorly due to tight external financial conditions. Meanwhile, domestic growth is slowing due to low oil prices. The Bank expects that Nigeria’s economic outlook will improve in the coming months due to gains in supply of fuel products and electricity. Moreover, the CBN stressed the need to intensify initiatives to bolster growth and counter a fragile macroeconomic environment.

Regarding price developments, the Bank acknowledged that the recent uptick in inflation mainly reflected higher energy prices, a delayed harvest and the pass through from imports. The next monetary policy meeting is scheduled for 23–24 November.

FocusEconomics Consensus Forecast panelists expect the monetary policy rate to end this year at 13.82%. Next year, the panel sees the monetary policy rate declining slightly to 13.55%.

Author: Ricard Torné, Lead Economist

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Nigeria Monetary Policy Chart

Nigeria Monetary Policy September 2015 1

Note: Monetary policy rate in %.
Source: Central Bank of Nigeria.

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