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Nigerian central bank keeps key rate unchanged

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Nigerian central bank keeps key rate unchanged

The Central Bank of Nigeria left its monetary policy rate unchanged at 13.5%, bucking the trend of other central banks around the world that have resumed policy easing amid sluggish economic growth.

The central bank also maintained its cash reserve ratio at 22.5% and the liquidity ratio at 30%.

Central bank Governor Godwin Emefiele said the decision to hold rates steady would enable the bank to assess the impact of current policies and stimulus measures before deciding on possible rate adjustments.

The central bank lowered its monetary policy rate by 50 basis points in March, its first rate cut since November 2015.

Emefiele warned that easing policy again would "heighten inflationary tendencies" in the domestic economy. In August, headline inflation fell to an annual rate of 11.02% from 11.08% in July, still well above the central bank's target range of 6% to 9%.

The central bank expects Nigeria's real GDP growth to average 2.11% and 2.34% in the third and fourth quarters, respectively, following a 1.94% expansion in the second quarter.