MPC Maintains Accommodative Stance…Cuts MPR to 12.50%

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In a shocking turn of events, the Monetary Policy Committee (MPC) cut its key policy rate MPR by 100bps to 12.50%, having maintained the prevailing rate over a year, while retaining all other policy parameters; CRR at 27.50%, Liquidity Ratio at 30.00%, and the Asymmetric Corridor at +200bps and -500bps around the MPR.

The committee reviewed the recent developments in the global and domestic space, as the
extended COVID-19 containment measures induced an economic shock. Thus, the committee observed the unprecedented fiscal and monetary support globally, weak aggregate demand, oil price shock, stock market crashes, record levels of unemployment, capital flow reversals across the emerging markets, mounting public debt as well as divergent forecasts across emerging economies.

Key macroeconomic variables such as the; slowdown in economic growth, the downtrend in PMI, an uptick in the inflation rate, pressured currency, and improved sentiment of investors towards the equities market was highlighted on the domestic scene. Hence, the committee felt that a loosening stance will trigger credit expansion to critically important sectors, which would, in turn, stimulate aggregate demand and supply in the short term, and even quicken the rebound in economic growth.

MPC’s Key Considerations

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❖ In arriving at its decision, the committee gauged the unprecedented and wide-ranging fiscal and monetary stance, having continually delivered their primary objective to mitigate an economic crisis and avoid an economic recession. Ultimately, significant uncertainties surround the resolution to the pandemic, precipitating varying forecasts among institutions and central banks.

❖ On the global economy, the committee stated that the restrictions on movements and economic activities had forced consumer spending solely on essential produce, thus suppressing aggregate demand, and placing inflation to levels below the 2% target. Further, the rebalancing of portfolios to safer assets in advanced economies should create renewed pressures on currencies of some EMDEs with a likely pass-through rate to domestic prices.

❖ On the domestic front, while the committee reiterated that GDP in 2019 expanded the most since 2015, the modest growth recorded in the first quarter of 2020 is expected to decline, albeit marginally in the coming period, as the influx of monetary and fiscal stimulus is expected to avert an impending recession.

❖ As indicated by the PMI, the health of manufacturing activities shuttered, as the manufacturing and non-manufacturing PMI contracted to 42.40pts and 25.30pts respectively, dragged by the declines across all its components.

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❖ The committee also observed the marginal growths in monetary aggregates, however, remaining below the indicative benchmarks. The committee further acknowledged the possibility of further monetary growth on the back of an imminent increase in the money supply.

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❖ The committee similarly opined that the monetary and fiscal support, as well as the positive outlook towards the oil market, improved investors sentiment in the equities market, hence increasing the All-Share-Index by 18.33% between the end of March and May 22, 2020.

❖ Further, the committee applauded the reduction in NPLs to 6.58% at the end of April 2020, as against 10.95% in the corresponding period of 2019. The MPC urged the banks to maintain its toolkit of prudential and regulatory measures to ensure NPLs stays below the prudential benchmark of 5.00%.

❖ In terms of the proposed intervention funds, the committee cited that; of the NGN1trn fund targeted at local manufacturing, NGN93.20bn had been disbursed, consisting of over 44 greenfield and brownfield projects. On the NGN50bn fund targeted for households and SMEs, NGN4.10bn had been expended to 5,868 beneficiaries. In a bid to address the dearth of infrastructures, the committee urged the federal government to explore fostering partnerships with the private sector to fund these investments.

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❖ On the case of tightening, the MPC felt that a hawkish stance would take a contradictory approach to boost economic growth, thereby weakening aggregate demand, leading to a decline in output, necessary for growth recovery. Although, on maintaining a hold decision, the committee considered the slowdown in trajectory of the economy and the weakening output growth does not bode well for the economy.

❖ On a balance of factors, an accommodative stance should lower lending costs across the board, build credit to the real sector, drive job creations while also lifting aggregate demand.


We believe that the shift in the policy rate sends a growth signal to the real sector of the economy. Thus, creating fewer funding pressures on businesses and driving a larger capacity for bank lending. We also note the signalling effect of the MPR is not as strong as it used to be. Given the low-interest-rate environment, we envisage a minimal effect on the treasury market, as assets are already trading below the MPR while bonds (mostly long-end) with yields higher than the MPR will gradually decline, to reflect the current MPR, amid robust participation in the market. In the equities market, a realignment of a portfolio should drive the uptick in the market, owing to the declining yields in the fixed income space.

Greenwich Research.

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MPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand SpurMPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand Spur

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MPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand SpurMPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand Spur

Latest News

Qatar Airways Launches Ferry Transfer Service from Shenzhen Shekou to Hong Kong International Airport

Qatar Airways introduces Upstream Check-in Service in Shenzhen starting from 15 April 2021 to offer greater connectivity in the Greater Bay Area

Local passengers will have the option to utilise the 30-minutes-long ferry service to fly out of Hong Kong; "Asia's World City" to over 80 destinations in Europe, the Middle East, Africa and the Americas

SHENZHEN & HONG KONG SAR, CHINA - Media OutReach - 12 April 2021 - Qatar Airways today announced the sea-to-air ferry transfer service from Shenzhen Shekou Port to the SkyPier in the airside of Hong Kong International Airport (HKIA) starting from 15 April 2021, providing passengers in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA), one of the world's most dynamic mega-regions, convenient access to the airline's global network from "Asia's World City".

MPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand Spur

Partnering with Airport Authority Hong Kong, the introduction of the Upstream Check-in Service will allow Qatar Airways customers in Shenzhen greater flexibility and enhanced travel options to the world from Hong Kong, where the airline operates daily direct service to Doha with its modern and fuel-efficient Airbus A350-900 aircraft that features 36 lie-flat seats in Business Class and 247 seats in Economy Class.

Qatar Airways customers can purchase their ferry tickets from SkyLink or the port's website. Passengers utilising the 30-minutes-long ferry service will be provided with boarding passes and baggage check-through service to their final destinations at the Shenzhen Shekou terminal, where they will also clear their customs and immigration. Upon arrival at SkyPier, customers can proceed directly to their Qatar Airways boarding gate, or enjoy the award-winning duty-free shopping experience and fine-dining options at HKIA before continuing a seamless and hassle-free onward journey with the airline to more than 80 destinations in Europe, the Middle East, Africa and the Americas.

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Mr. Thomas Scruby, Qatar Airways Vice President of Sales for Australasia & North Asia, said: "The introduction of ferry transfer service will boost our footprint in the Greater Bay Area by providing our Southern Chinese customers more flexible flying options via HKIA. We know connectivity within the region and to the wider world is critical for the success of the GBA. Therefore, we are excited to do our part to build the infrastructure necessary to make it easier and smoother for local customers to travel despite the disruption caused by the pandemic around the world."

"We are confident in the market's demand and our commitment to the region remains resolute. The next phase of our partnership with Airport Authority Hong Kong will see the ferry transfer service to be further expanded to other key GBA metropolis such as Macau and Dongguan once government restrictions are lifted, allowing even more customers in the region to enjoy the world-class experience that Qatar Airways has to offer."

Premium customers opting for the ferry transfer service can continue to enjoy the luxurious on-ground experience at the Plaza Premium Lounge, conveniently located near Gate 1 at the South Departures Hall in Hong Kong International Airport. Passengers will be able to take advantage of the well-furnished environment with comfortable seating, shower rooms, contactless food ordering service, highspeed Wi-Fi and international TV channels. Privilege Club Gold members and above as well as selected oneworld frequent flyers also enjoy access to The Wing located near Gates 1 - 4, the industry-renowned lounge operated by Cathay Pacific, where guests can recharge, relax, and catch up with work before boarding their Qatar Airways flights.

The Greater Bay area is home to many of the nation's leading universities and academic institutions; the ferry transfer service will also provide more travel choices to the area's students wishing to complete their higher-education or exchange programs abroad. International students will be able to enroll in Qatar Airways Student Club and enjoy a wide range of benefits throughout their educational journey, such as special fares, extra baggage allowances, the flexibility to change the dates of their flight, complimentary Super Wi-Fi onboard, and more. For information about Student Club, visit:

In addition to the highest safety standards, passengers flying with Qatar Airways will enjoy an even greater range of thoughtfully designed onboard experiences, including locally inspired menus, multi-language entertainment programs within the airline's award-winning IFE system, as well as Cantonese and Mandarin-speaking staff service both onboard and at the airline's five-star hub Hamad International Airport (HIA).

Qatar Airways continues to expand its network of destinations, offering more flights to international destinations than any other airline. By the middle of summer 2021, Qatar Airways' plans to rebuild its network to more than 140 destinations including 23 in Africa, 14 in the Americas, 43 in Asia-Pacific, 43 in Europe and 19 in Middle East. Many cities will be served with a strong schedule with daily or more frequencies.

Qatar Airways has become the first global airline in the world to achieve the prestigious 5-Star COVID-19 Airline Safety Rating by international air transport rating organisation, Skytrax. This follows HIA's recent success as the first airport in the Middle East and Asia to be awarded a Skytrax 5-Star COVID-19 Airport Safety Rating. These recognitions provide assurance to passengers across the world that airline health and safety standards are subject to the highest possible standards of professional, independent scrutiny and assessment. For full details of all the measures that have been implemented onboard and in HIA, please visit

A multiple award-winning airline, Qatar Airways was named 'World's Best Airline' by the 2019 World Airline Awards, managed by the international air transport rating organisation Skytrax. It was also named 'Best Airline in the Middle East', 'World's Best Business Class', and 'Best Business Class Seat', in recognition of its ground-breaking Business Class experience, Qsuite. Qsuite is available on flights to more than 45 destinations including Johannesburg, Frankfurt, New York and Singapore.

About Qatar Airways:

A multiple award-winning airline, Qatar Airways was named 'World's Best Airline' by the 2019 World Airline Awards, managed by international air transport rating organisation Skytrax. It was also named 'Best Airline in the Middle East', 'World's Best Business Class' and 'Best Business Class Seat', in recognition of its ground-breaking Business Class experience, Qsuite. Qatar Airways is the only airline to have been awarded the coveted "Skytrax Airline of the Year" title, which is recognised as the pinnacle of excellence in the airline industry, five times.

Hamad International Airport (HIA), the airline's home and hub, was recently ranked "Third Best Airport in the World", among 550 airports worldwide, by the SKYTRAX World Airport Awards 2020. Rising from fourth position in 2019 to third in 2020, HIA has been steadily rising in the 'World's Best Airports' rankings since the start of its operations in 2014. In addition, HIA was voted the 'Best Airport in the Middle East' for the sixth year in a row and 'Best Staff Service in the Middle East' for the fifth year in a row.

Qsuite, a patented Qatar Airways product, features the industry's first-ever double bed in Business Class, as well as privacy panels that stow away, allowing passengers in adjoining seats to create their own private room, a first of its kind in the industry.

Qatar Airways was the first Gulf carrier to join global airline alliance oneworld, enabling its passengers to benefit from more than 1,000 airports in more than 160 countries, with 14,250 daily departures.

Oryx One, Qatar Airways' in-flight entertainment system offers passengers up to 4,000 entertainment options from the latest blockbuster movies, TV box sets, music, games and much more. Passengers flying on Qatar Airways flights served by its B787, B777, A350, A380, A319 and select A320 and A330 aircraft can also stay in touch with their friends and family around the world by using the award-winning airline's on-board Wi-Fi and GSM service.

Qatar Airways proudly supports a range of exciting international and local initiatives dedicated to enriching the global community that it serves. Qatar Airways, the official FIFA partner, is the official sponsor of many top-level sporting events, including the FIFA World Cup Qatar 2022TM, reflecting the values of sports as a means of bringing people together, something at the core of the airline's own brand message - Going Places Together.

Qatar Airways Cargo, one of the world's leading international air cargo carriers, serves more than 60 freighter destinations worldwide via its world-class Doha hub and also delivers freight in the belly-hold of passenger aircraft to an extensive global network. The Qatar Airways Cargo fleet includes two Boeing 747-8 freighters and 24 Boeing 777 freighters.

Qatar Executive is the private jet charter division of Qatar Airways Group. Luxury jet services are available for worldwide charter on board the operator's wholly-owned business jet fleet. Qatar Executive is the launch customer for Gulfstream's G700, the world's first commercial service operator of the Gulfstream G500 and largest commercial operator of the G650ER worldwide. Qatar Executive's service portfolio also includes aircraft management, maintenance and Fixed Based Operator services.

MPC Maintains Accommodative Stance…Cuts MPR to 12.50% - Brand Spur
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