Post MPC Meeting Report - Hawkish MPC Tightens the Asymmetric Corridor
During the 292nd Monetary Policy Committee (MPC) meeting conducted on the 24th and 25th of July 2023, the Monetary Policy Committee of the Central Bank of Nigeria (CBN) maintained its hawkish streak, for the eighth (8th) consecutive time since May 2022. The Monetary Policy Committee (MPC) decided to increase the Monetary Policy Rate (MPR) by 25bps to 18.75%, aligning with the expectations outlined in our H2:2023 outlook report. Additionally, the Committee tightened the asymmetric corridor to +100/-300 basis points around the MPR. This represents the first adjustment made to the asymmetric corridor since September 2020.
Out of the eleven (11) members at the meeting, six (6) voted in favor of raising the MPR. Amongst the six (6), four (4) members supported a 25bps increase, while two (2) voted for a 50bps hike. However, all members of the Committee voted to adjust the asymmetric corridor.
In summary, the Committee decided to:
- Raise MPR by 25bps to 18.75% from 18.50%
- Adjust the asymmetric corridor to +100/-300 basis points from +100/-700 basis points around the MPR
- Retain CRR at 32.50%
- Keep the Liquidity Ratio at 30.00%
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