For the second time in less than one year, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has slashed Monetary Policy Rate (MPR). This time from 13.5% to 12.5 per cent.
This decision was reached at the MPC meeting held under COVID-19 protocols and chaired by the CBN Governor, Godwin Emefiele, who also doubles as MPC chairman.
Emefiele while delivering the communiqué of the meeting said the MPR reduced the MPR from 13.5% to 12.5% but retained other monetary policy parameters.
According to Emefiele, the MPC resolved to retain the Liquidity Ratio at 30 per cent, Cash Reserve Requirement (CRR) at 27.5 per cent and the asymmetric corridor at +200/-500 basis points around the MPR.
The MPR is the instrument used by the Central Bank of Nigeria to control interest/ lending rates.
The latest reduction in the MPR followed on the heels of a call by All Progressive Congress (APC) national chairman, Asiwaju Bola Ahmed Tinubu for the CBN to reduce interest rates so that investors and manufacturers could access fund at a cheaper rate.
CBN ensured that it put in place all necessary machinery for the meeting to hold for only one day over the on-going COVID-19 national lockdown and align the meeting with extant rules of the Presidential Task Force (PTF) on COVID-19 and advisories from other relevant agencies.