Nigerian stocks fall to one-week low after central bank cancels rate meeting

Nigerian stocks fell 2.7 pct to a one-week low on Tuesday after the central bank called off an interest rate meeting scheduled for Jan. 22-23.

The central bank said the meeting was not held due to its inability to form a quorum,adding that it will maintain its benchmark interest rate at 14 percent, the level it has kept for more than a year, to tighten liquidity and support the currency.

Stocks also fell on Monday, the day the MPC had been due to start meeting to decide on interest rates.

Stocks fell below to 44,000 points, to a level last seen in January 2018. The main index, which gained 42 percent in 2017, fell for the second straight day after climbing to a nine-year high last week.

Traders had hinged this year’s rally on hopes of a stable currency and lower interest rates driving corporate earnings.

The decision to cancel the meeting comes as several new members of the MPC are yet to be approved by lawmakers, a situation resulting from a standoff between Nigeria’s presidency and parliament over the latter’s powers to confirm or deny executive nominees to key posts within the government.

At least five of the MPC’s 12 members are due to be replaced after retiring last year.

Analysts say the stalemate could damage investor confidence in the economy which is already fragile and risk derailing reforms badly needed to boost growth.

The index of Nigeria’s top 10 lenders fell 4.1 percent to lead the decliners.

Fidelity Bank shed 9.2 percent to fall the most. Dangote Cement, which accounts for a third of market capitalisation, fell 4.8 percent.