Nigeria’s central bank has decided to keep interest rates at 11 per cent, which although high by normal standards, is the lowest level since the end of 2011.
Rates were lowered to 11 per cent from 13 per cent in November last year and were not expected to move at this month’s meeting of the central bank, despite growing concerns over the state of the Nigerian economy, which has been hit hard by low oil prices, its main export.

The Nigerian government last year introduced capital controls and fixed the exchange rate at 198 naira per dollar to stop its currency from tumbling further against the greenback, but speculation has been mounting that it may be forced into a devaluation as its finances come under increasing pressure.

Nigeria’s foreign reserves dropped to an 11-month low of of $29.1bn at the start of the month.

As the FT’s Maggie Fick recently reported, Nigeria plans to borrow up to $4.5bn from international investors organisations such as the World Bank to help fund a budget deficit triggered by the collapse in oil prices.

Earlier today consumer goods heavyweight PZ Cussons, the maker of Imperial Leather soap, which has a sizeable business in Nigeria, highlighted the limited availability of foreign exchange as one of the challenges with which it has recently had to contend.

http://abokifx.com/nigeria-holds-rates-but-clouds-gather-over-economy-ft/