Central Bank of Nigeria keeps benchmark lending rate at 14 percent

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In a split decision that reflected the Central Bank of Nigeria’s (CBN) need to address sluggish growth and accelerating inflation, CBN Governor, Godwin Emefiele said the bank has decided to keep its main interest rate at 14 percent. The rate has been at a record high since July 2016.

Three of the ten members of the monetary policy committee voted to tighten by 25 basis points. Analysts polled by Reuters however predicted that the bank would not change their lending rate. Nigeria, which emerged from its first recession in 2017, continues to suffer sluggish growth and high inflation.

Emefiele said “there is the need to maintain the current monetary policy stance and await a clearer understanding of the quantum and timing of liquidity injections into the economy before deciding on possible adjustments”.

As a result of food prices, inflation rose in August for the first time in a year and half. Economic growth also dipped to 1.50 percent in the second quarter, continuing a trend of slowing growth that began in the first quarter.

President Buhari who came into power in 2015 by promising to restore Nigeria’s economy, will run for a second term in elections to be held in February 2019.

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