Nigeria’s Central Bank holds rates thrice in a row

Predictable Olayemi Cardoso left borrowing costs (27.50%) unchanged at the third interest rate meeting of the year as policymakers continued to adopt a wait and see approach following an easing in consumer prices.

A survey of economists by Condia expected Nigeria’s Central Bank Governor, Olayemi Cardoso to attempt a dovish stance following the cooldown of inflationary pressures.

“The committee decided to maintain the current policy stance and hold all policy parameters as follows,” Cardoso said during the meeting that held Tuesday in Abuja.

“The decision was premised on the need to sustain the momentum of disinflation and contain price pressures. Maintaining the current policy stance will continue to address the existing and emerging inflationary pressure.”

A revamp of the consumer-price index by the statistics bureau in January led the MPC to pull the brakes on a record interest-rate hiking cycle to gain clarity on the direction of inflation.

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Nigeria’s inflation cooled to 22.22% for a third consecutive time this month, reflecting persistent short term pressures. The hold was the base case for most observers, some see a potential for future easing if the disinflationary trend continues.

“While a hold at 27.5% remains the likely outcome, the possibility of a small measured cut cannot be ruled out,” analysts at the financial services group Norrenberger wrote in a note to clients.