The Central Bank of Nigeria (CBN) yesterday commenced its 302nd Monetary Policy Committee (MPC) meeting in Abuja, with attention focused on possible adjustments to interest rates and inflation management.
The two-day meeting coincides with the second anniversary of CBN Governor Olayemi Cardoso and his deputy governors in office. The committee is expected to decide on the Monetary Policy Rate (MPR) and other key indicators, following five consecutive months of easing inflation.
Headline inflation slowed to 21.12 per cent in August, down from 21.88 per cent in July, while the MPR has been held at 27.5 per cent since July. Despite the moderation, analysts say prices remain high. Data expert Babajide Ogunsawo said Nigeria is witnessing disinflation rather than deflation, noting that the pace of price increases has slowed, but costs are not falling.
Amid this backdrop, the Centre for the Promotion of Private Enterprise (CPPE) has urged the CBN to ease its monetary stance. In a statement on Sunday, CPPE chief executive officer Muda Yusuf called for cuts to both the MPR and the 50 per cent cash reserve ratio to lower production costs and ease borrowing pressure on businesses. “The Monetary Policy Rate at 27.5 per cent and the Cash Reserve Ratio at 50 per cent have considerably pushed up the cost of funds. Elevated lending rates have suppressed private sector borrowing, particularly in manufacturing, agriculture, SMEs, real estate, and other sectors,” Yusuf said.
The MPC is expected to release its decisions at the end of deliberations on Tuesday.
