Nigeria Leaves Monetary Policy Unchanged

Nigeria’s central bank left the monetary policy rate on hold at 13 percent on July 24th. As policymakers voiced concern over the rise in headline inflation, while saying that monetary policy is going to remain tight due to high liquidity.

The CRR on Private and Public Sector deposits were both retained at 31 percent. The liquidity ratio was retained at 30 percent.

Nigeria inflation rate grew for the seventh consecutive month to a 2-year high of 9.2 percent in June of 2015. The naira depreciation along with irregularity of the fuel supply and delay in a rainy season continued to push food costs up. 

Meanwhile, the government saw its revenues fall this year, as the country struggled to deal with the persistent drop in crude prices, forcing the central bank to use its forex reserves to support the naira. On July 22nd, the reserves had fallen 20.9 percent to $30.7 billion from $38.8 billion a year earlier. Last month, additional measures were taken by the central bank to restrict access to the foreign exchange market in an attempt to preserve the falling forex reserves.

Nigeria Leaves Monetary Policy Unchanged

Central Bank of Nigeria |
7/24/2015 4:04:38 PM