Nigeria central bank holds interest rate at 14 pct

Record ID: 77920

  • Title: Nigeria central bank holds interest rate at 14 pct
  • Date: 22nd November 2016
  • Summary: ABUJA, NIGERIA (NOVEMBER 22, 2016) (REUTERS) NIGERIA'S CENTRAL BANK GOVERNOR GODWIN EMEFIELE AND OTHER OFFICIALS SEATED AT BRIEFING EMEFIELE AND OTHER OFFICIALS SEATED EMEFIELE MAKING NOTES OFFICIALS SEATED (SOUNDBITE) (English) NIGERIA'S CENTRAL BANK GOVERNOR, GODWIN EMEFIELE, SAYING: "Committee assessed the relevant risks to the global and domestic economy and concluded that the risks to the economy remained highly elevated on two fronts, price and output. However considering the importance of price to stability and being mindful of the limitations of monetary policy in influencing output and employment under the conditions of stagflation, committee decided unanimously to retain current stance of monetary policy thus keeping MPR (monthly payment rates) at 14 percent alongside all other policy parameters." DEPUTY CENTRAL BANK OF NIGERIA GOVERNOR SEATED VARIOUS OF CENTRAL BANK OF NIGERIA OFFICIALS SEATED (SOUNDBITE) (English) NIGERIA'S CENTRAL BANK GOVERNOR, GODWIN EMEFIELE, SAYING: "The MPC (Monetary Policy Committee) urged the government to urgently assess the level of its indebtedness to domestic economic agents and develop a framework for securitising the debts in order to settle its outstanding domestic contractual obligations which cuts across all sectors of the economy. These accumulated debts have slowed business activities of economic agents most of whom are indebted to the banking system thus compromising the integrity of the financial system." VARIOUS OF JOURNALISTS SEATED OFFICIALS SEATED AT BRIEFING
  • Embargoed: 7th December 2016 16:37
  • Keywords: Central bank Interest rate Economy Recession Monetary policy Gross domestic product
  • Location: ABUJA, NIGERIA
  • City: ABUJA, NIGERIA
  • Country: Nigeria
  • Topics: Economic Events
  • Reuters ID: LVA00159J0IH9
  • Aspect Ratio: 16:9
  • Story Text:Nigeria's central bank kept its main interest rate on hold on Tuesday (November 22) for the second month in a row, as Africa's biggest economy contends with its first recession in 25 years due to low oil prices combined with high inflation.
    Prices for oil, Nigeria's main export, have languished in the last few years, while inflation accelerated to a more than 11-year high of 18.3 percent in October, creating the conditions for 'stagflation' - low or no growth combined with high prices.
    Nigeria's Central Bank Governor Godwin Emefiele said the decisions to keep the benchmark interest rate at 14 percent and keep cash reserve ratios for commercial banks at 22.5 percent were agreed by all 10 members of the Monetary Policy Committee present.
    Emefiele said that the risks to the global and domestic economy remained highly elevated in price and output.
    "However considering the importance of price to stability and being mindful of the limitations of monetary policy in influencing output and employment under the conditions of stagflation, committee decided unanimously to retain current stance of monetary policy thus keeping MPR at 14 percent alongside all other policy parameters," he said.
    The rate decision was expected by most of the economists polled by Reuters last week who saw the policy in line with the banks' efforts to resuscitate growth in the economy.
    Emefiele said that the government's debts have slowed business activities of economic agents most of whom are indebted to the banking system, compromising the integrity of the financial system.
    "The MPC (monetary policy committee) urged the government to urgently assess the level of its indebtedness to domestic economic agents and develop a framework for securitising the debts in order to settle its outstanding domestic contractual obligations which cuts across all sectors of the economy," he said.
    The rate decision comes a day after data showed the recession was deepening, with Nigeria's gross domestic product contracting in the third quarter by 2.24 percent year-on-year.
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