Interest rate hike likely as MPC meets today

Ahead of the two-day Monetary Policy Committee meeting of the Central Bank of Nigeria commencing on Monday (today), financial experts have expressed diverse views on possible outcomes of the rates.

The CBN disclosed it would hold its 289th meeting in Abuja.

Experts and researchers at Cordros Securities expect a rate hike after the meeting, saying we ‘MPC to favour smaller rate hikes in the short-term.’

In a report, they stated, “Elsewhere, the prospect of global central banks embarking on smaller interest rate hikes could also influence the MPC’s decision to toe the same line amid concerns about the domestic economy. Thus, we expect the MPC to opt for smaller rate hikes in the short-term, given the build-up of pressures in the local economy and as the risks of over-tightening come to the forefront of policy discussions. Consequently, we expect the committee to increase the MPR further by 50bps – 100bps and retain other policy parameters.”

According to the report, the committee remains faced with either maintaining its hiking cycle or keeping policy parameters unchanged.

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