The Head of Department, Banking and Finance, Nassarawa State University, Prof. Uche Uwaleke, has said that he is not expecting any change in the policy rates at the Monetary Policy Committee (MPC) meeting currently in Abuja
Uwaleke in an WhatsApp message to Business Eye, said: “There is interest rate hike in the U.S. which is triggering capital flows out of Nigeria and leading to a drop in external reserves.
“There is also the threat on crude oil price volatility from US-China trade war and reversal in downward trend in inflation.
“There is also labour’s demand for minimum wage implementation, increasing FAAC allocation and rising pre-election spending,” he added.
The Capital market expert pointed out that with the 2019 elections approaching, the MPC was likely to retain the monetary rates to avoid unpopular policies.
The MPC is the highest monetary policy making committee of the CBN and its mandate is to review economic and financial conditions in the economy to determine appropriate monetary policy rates in the short to medium-term, among others.
At the last MPC meeting, the MPR was retained at 14 per cent, Cash Reserve Ratio at 22.5 per cent and Liquidity Ratio is at 30 per cent. While the Asymmetric corridor remained at +200 and -500 basis points around the MPR.