The Central Bank of Nigeria (CBN’s) Monetary Policy Committee has maintained its key lending rate at 11.5 per cent, with the asymetric corridor of +100 and -700 basis points around the MPR.
This is coming on the heels on continued poor showing of the local currency against the dollar on the parallel market on Friday, closing at N575 to the greenback.
This comes as the latest report from the National Bureau of Statistics show that Nigeria’s inflation moderated for the fifth consecutive month to 17.01 per cent in August.
At its last meeting in July, the CBN MPC voted to hold all policy parameters constant, believing that it would enable the continued passage of current policy measures in supporting the growth recovery recorded in the second quarter and macro-economic stability.
As at noon on Friday, it went down a little exchanging for N575/$
Traders attributed the free fall of the local currency against the dollar to lack of dollar liquidity in the market, which service the bulk of retail and small and medium scale businesses.
Although CBN has continued to advise the public to discontenance the parallel market as it’s not the true reflection of the market, many importers largely depend on the parallel market to source their foreign exchange need, putting pressure on the local currency as the official window remains restrictive for forex endusers due to dollar shortages.