A stable deposit base as opposed to volatile, short-term funds has started to impact positively on interest rates stability. In order to fast track interest rates stability, the CBN introduced a new framework for the implementation of monetary policy in December of 2006. As part of the new framework, the Bank established a standing deposit and lending facility and replaced the MRR with the Monetary Policy Rate (MPR) which was initially set at 10.0 per cent (but reviewed downwards subsequently). The entire system was designed as a corridor with the lending facility as the upper bound of the corridor while the deposit facility served as the lower bound. The entire corridor had a width of 600 basis points with the MPR at the centre….
About the Author - Central Bank Of Nigeria (CBN) - Education Series
The series seeks to educate stakeholders and the general public on monetary policy issues such as: what is monetary policy, how it is conducted, What it can do and not do and how the monetary policy actions of the Central Bank of Nigeria affects Nigerians, the economy and the outside world.
The current monetary policy framework is based on the targeting of bank reserves as operating target with monetary aggregates as intermediate target. The ultimate objective is to influence the general level of prices - inflation.
Monetary targeting implied by the current practice was consider [Read more]
Report Highlights: Nigeria's grain production this year is up slightly from the average crop of 2010. Farmers increased average and rainfall patterns were near ideal for the growing season. The arrival of the new crop in the market has not brought any respite to poultry producers as grain pri [Read more]
1. Is Nigeria developing a Single-Term Syndrome?
The appointment of a new governor to lead the Central Bank of Nigeria (CBN) from June 2014 to June 2019 brings the number of persons so appointed since 29 May 1999 to four, although only the last two appointments were made after the 2007 CBN Act wa [Read more]