For the umpteenth time, the Central Bank of Nigeria (CBN) has raised the monetary policy rate (MPR) by 25 basis points to 27.50% from 27.25%, in a bid to curb rising inflation.
The decision was reached during the Monetary Policy Committee (MPC) meeting on Tuesday where members voted unanimously to increase the benchmark interest rate.
The move aims to combat inflation, which has been on the rise, with the October inflation rate standing at 33.88%.
In addition to the MPR hike, the CBN retained the Cash Reserve Ratio (CRR) at 50% for Deposit Money Banks and 16% for Merchant Banks.
The Liquidity Ratio (LR) was also kept unchanged at 30%, while the asymmetric corridor around the MPR remains at +500/-100 basis points. These decisions reflect the CBN’s commitment to maintaining a tight monetary policy stance to address inflation concerns.
The interest rate hike is expected to have a ripple effect on the economy, with potential impacts on borrowing costs, consumer spending, and business investment.
More to follow…
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