As members of Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) begin their two-day meeting today, market pundits at Cordros Group said the apex bank might hike the benchmark interest rate to reflect the subtle improvement in the macroeconomic environment. Analysts at Cordros Group said while voting among the MPC members would be divergent as usual, most members would vote for increase in the benchmark Monetary Policy rate (MPR) from 11.50 per cent. “Our baseline expectation is that most members will vote for a 50-basis points hike in MPR. However, we do not rule out the possibility of a 100-basis points hike, particularly if the first quarter 2021 Gross Domestic Product (GDP) numbers surprise positively,” Cordros Group said. According to analysts, the third MPC meeting comes at a time of fascinating developments in the domestic and external economy as inflationary pressures cooled down in Nigeria in April despite lingering supply-side challenges while risks to global economic growth remain roughly balanced despite emerging bumps that could undermine reflation trade and the commodity super cycle.
The Nation