*Tasks CBN to double its effort at supporting priority growth
WorldStage Newsonline– As the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) rose from its two-day meeting on Tuesday with the decision to increase the Monetary Policy Rate (MPR) to 13 per cent, members also expressed deep concern over the continued inflationary pressure in spite the gradual improvement in output.
Mr Godwin Emefiele, Governor of the CBN who read the 285th communiqué of the meeting said the committee was faced with various options, but guided by the need to slow down inflationary pressure while engendering economic growth.
He said that, though the 11 MPC members unanimously voted to raise the MPR, they provided divergent opinions on the level of increase.
“Six members voted to raise the MPR by 150 basis points, four members’ by100 basis points and one member, by 50 basis points.
“Committee notes that the current rise in inflation is inimical to growth and the full recovery of the Nigerian economy,’’ he said.
He said that several options were considered before the decision to increase the MPR.
“After carefully reviewing developments in the two months, and outlook of growth in the domestic and global economy as well as downsides of each policy.
“It is clear and compelling that tackling inflation is more urgent in sequence of policy objectives.
“MPC urged the CBN to double its effort at supporting the priority growth-enhancing sectors of the economy.
“It urged the Federal Government to do more to provide a safe and secure environment for economic activities to stimulate growth,’’ he said.
It was the first time in over two years that the MPR would be increased from 11.5 per cent.
The asymmetric corridor was however retained at +100/-700 Basic Points around the MPR, the Cash Reserve Ratio (CRR) retained at 27.50 per cent and the Liquidity Ratio retained at 30.00 per cent.
