Excerpt from the statement by the Central Bank of Nigeria:
The National Bureau of Statistics forecasts real GDP growth rate of 6.72 percent for Q2, 2013, an improvement over the Q1 estimate of 6.58 percent.
However, the Committee noted with caution, the high GDP growth projection in view of the extant risk factors such as widespread insecurity, weak infrastructure and probable flooding from the projected heavy rains in some parts of the country. In addition, the state of emergency in the North East and the accompanying military operations in that axis have the potential to adversely affect economic activities generally, including agricultural production and food prices, as well as consumer demand.
The inflation outlook remains relatively benign with projections of headline inflation remaining in the single digit range for the next six months. The principal risks to the outlook remain fiscal spending and possible pressures on the exchange rate from any attrition to reserves caused by declining revenues as a result of output leakages.
The Committee decided to retain the Monetary Policy Rate (MPR) at 12 percent with a corridor of +/-200 basis points around the MPR; retain the Cash Reserve Requirement at 12 percent and Liquidity Ratio at 30 percent; with the Net Open Position at 1.0 percent.