Capital market Professor at the Nasarawa State University, Uche Uwaleke has hailed the decision of the Monetary Policy Committee of the Central Bank of Nigeria (CBN) to cut interest rate to 12.5 percent.
Uwaleke, who stated this while reacting to the reduction in Monetary Policy Rate (MPR)from 13.5 per cent to 12.5 per cent by the MPC on Thursday in Abuja, added that the decision is a demonstration of CBN effect to stimulate the economy.
“The MPC decision to cut the benchmark interest rate by 100 basis points down to 12.5% is a demonstration of the CBN’s sensitivity to the need to stimulate the economy and enable it withstand the negative impact of COVID’19 as well as the drop in oil revenue,” the former Imo state commissioner of finance said.
The Apex Bank has since the economic disruptions occasioned by ravaging effect of coronavirus pandemic introduced various initiative to jumpstart the economy which has been on shutdown as government battled to curb the spread of the virus.
Earlier this week, the banking sector regulator had directed financial institutions to give loans at 5 percent as part of effort to spur lending to the real sector.
He however urged the Apex Bank to monitor the banks to ensure its implementation.
“Having signalled intention to adopt an accommodative stance in favour of growth, the CBN should put in place measures to ensure that it translates to lower lending rates by the banks to the real sectors of the economy.”