The Monetary Policy Committee(MPC) of the Central Bank of Nigeria (CBN) on Tuesday, unanimously voted to retain the Monetary Policy Rate (MPR), which determines interest rate, at 11.5 per cent.
The governor of the CBN, Godwin Emefiele announced the committee’s decision at the end of its two-day meeting.
The committee also retained the Liquidity Ratio at 30 per cent and Cash Reserve Ratio (CRR) at 27.5 per cent.
Emefiele described a statement by Fitch, a credit rating agency, that sustained use of direct financing from the CBN to fund budget deficit could raise risks to macroeconomic stability, as “unfair and unfortunate to hold such views”.
Noting that the CBN is a banker to the government and lender of last resort to banks that face short term liquidity challenge.
The MPC also warned the Nigerian government against total lockdown of the economy which may reverse the gains of economic stimulus achieved in 2020.