Experts Expect MPC to Hold Rates at 14%

By Dipo Olowookere

Central Bank of Nigeria (CBN) is expected to begin its first Monetary Policy Committee (MPC) meeting of 2018 tomorrow, Tuesday, April 3 and announce monetary policy decisions taken by the committee on Wednesday.

Already, observers are making their forecasts concerning the meeting and predict that the MPC will likely retain the rates at 14 percent.

According to analysts at Meristem Research, the committee is expected to consider the current state of key macroeconomic variables, the success recorded in the ongoing implementation of the 2017 budget, performance of the financial markets as well as the rising oil price environment and its effect on the Nigerian economy, amongst other recent events.

The investment research firm said there have been improvement in some key macroeconomic variables over the last year, the decision to change status quo may be hindered by narrowing yield differential with the US, and the need to achieve more clarity on sustained economic growth whilst also promoting price stability.

“Also, given the delayed confirmation of the presidential nominees for the MPC by the senate, the committee may defer any anticipated change from the current policy stance at their first seating.

“Given the above, we expect the Committee to hold rates at its first meeting,” Meristem Research said.

During tomorrow’s meeting, the MPC is expected to review the development and gains recorded at both the global and domestic economy over the past year vis-à-vis the various economic policies directed at sustaining growth as well as improving price stability in 2018.