The Monetary Policy Committee (MPC) of Central Bank of Nigeria(CBN) has reduced the monetary policy rate (MPR), to 12.5 per cent
The CBN governor, Godwin Emefiele disclosed this while reading the communique at the end of the MPC meeting on Thursday.
Emefiele also announced that the committee retained the Cash Reserve Ratio at 27.5%, while the liquidity ratio was retained at 30%.
The CBN Governor said the decision to loosen the monetary policy rate was as a result of the present economic realities Caused by the COVID 19 Pandemic and the drop in global oil prices.
“On decision to Hold, loosen or tighten, the MPC was of the view that tighten of policy stance is for now inappropriate, this is because tighten will result in further contractions of aggregate demand as disposable income diminishes leading to decline in output.”
He added the bank has disbursed N93.2 billion Naira under the real sector support fund to local manufacturing and production across critical sectors.
” The bank has also approved N10.9 billion to 14,331 beneficiaries under the N50 billion targeted credit facility for household and small and medium enterprises out of which N4.1 billion has been disbursed to 5,868 successful beneficiaries.
The CBN Governor noted that Nigeria may escape a recession if efforts are sustained to stimulate output.