Central Bank of Nigeria meets this week for its 293rd Monetary Policy Committee (MPC), meeting Nigeria’s foreign exchange crisis, interest rate volatility, inflation rate spikes and many other pressing issues will take centre stage. This will be the CBN’s first Monetary Policy Committee (MPC) meeting under Governor Yemi Cardoso and his recently appointed committee members.
It would be recalled that the MPC last met in July 2023 and was presided over by the then-acting CBN governor, Folashodun Shonubi. The meeting will be for two days.
In January 2024, the CBN disclosed the scheduling of the MPC meeting, to be presided over by Mr. Cardoso, for the 26th and 27th of February. This announcement marked the first MPC meeting in six months, following the last session held in July 2023. The outcome of the meeting is expected to chart the course for the CBN’s strategy to tackle Nigeria’s economy and financial challenges.
Since assuming office in September 2023, Mr. Cardoso has overseen the apex bank’s utilization of Open Market Operations to implement measures to tighten its monetary policy stance in alignment with efforts to address inflationary pressures.
In a recent statement regarding the upcoming MPC meeting, Cardoso conveyed his optimism about its potential impact on the economy, expressing confidence that it would steer the economy in a positive direction.
Accoprding to several economic analysts, the Monetary Policy Rate (MPR) commomly referred to as the benchmark interest rate is forecasted to be tightened to curb inflation and mitigate the ongoing naira depreciation. During the July 2023 meeting, the committee increased the MPR by 25 basis points, raising it from 18.50% to 18.75%. According to a recent survey conducted by Reuters, indications point to a potential increase of 225 basis points in Nigeria’s monetary policy rate by the MPC, bringing it to 21.00%.
