Nigeria Approves MPC Members to Break Hiatus on Policy Rate

LAGOS (Capital Markets in Africa) – Nigeria’s monetary-policy authorities can finally get back to the business of setting the country’s interest rates following a four-month hiatus.

The Nigerian Senate on Thursday approved the appointment of two new central bank deputy governors and three other Monetary Policy Committee members, paving the way for a meeting to review interest rates for the first time this year.

The lawmakers confirmed President Muhammadu Buhari’s nomination of Aishah Ahmad and Edward Adamu as deputy governors, according to proceedings led by Senate President Bukola Saraki in the capital, Abuja. They also approved Adeola Adenikinju, Aliyu Sanusi and Robert Asogwa as MPC members. The Senate rejected one nominee, Asheikh Maidugu.

“This exercise will allow the central bank to continue to play its role in providing stability in our economy,” Saraki said in post on the Senate’s Twitter account. “We need to continue with our economic growth and see the sustainability of the foreign exchange.”

The MPC failed to meet as scheduled in January, and postponed its March meeting because it didn’t have the quorum required to convene and set rates. Lawmakers had initially refused to approve Buhari’s nominees due to political differences. The central bank schedules six meetings in a year. The law requires a minimum of four meetings annually.

The benchmark interest rate has been at a record 14 percent since July 2016 as policy makers tried to balance between fighting inflation and stemming a drop in the naira, with the need to support an economy that contracted in 2016. Central bank Governor Godwin Emefiele has said the MPC could loosen policy before July if inflation drops nearer to single digits. Price growth slowed to a 22-month low of 14.3 percent in February, remaining outside the target of 6 percent to 9 percent.

The MPC March meeting was postponed to early April to allow the Senate to screen and approve the nominees.