ABUJA, May 21 – Nigeria’s central bank held its benchmark interest rate at 13.5%, its governor Godwin Emefiele said on Tuesday, after a surprise 0.5 percentage point cut at the previous meeting.
According to polls by analysts expected no change. A minority predicted a rate cut
The decision comes a day after Nigeria’s statistics office said economic growth had slowed in the first quarter of 2019, dropping to 2.01% from 2.38% in the previous quarter as the country’s dominant oil sector shrank.
Emefiele, who this month became the first Nigerian central bank governor since the return to democracy in 1999 to be given a second term, said the central bank predicted that growth this year would come in at 2.38 percent.
At the last interest rate meeting in March, the central bank made an unexpected cut as part of an attempt to stimulate growth in Africa’s biggest economy and signal a “new direction”.
The move was the first rate cut since November 2015. The rate had been held at 14% since July 2016 to support the naira and curb inflation.
Nigeria emerged from its first recession in 25 years in 2017. Higher oil prices and recent debt sales have helped it accrue billions of dollars in foreign reserves.
But growth remains fragile and inflation edged up in April to 11.37% from 11.25% a month earlier.