Following a two-day meeting of the bank’s monetary policy committee (MPC), the central bank of Nigeria (CBN) has raised the interest rate by 150 basis points, to 26.25% from 24.75%. The apex bank’s policy making body agreed to raise the monetary policy rate for the third consecutive time to address soaring inflation, which stood at 33.69% according to latest data.
The MPC held its 295th meeting on the 20th and 21st of May 2024 to review recent economic and financial developments and assess risks to the outlook according to the CBN governor Yemi Cardoso, who also chairs the committee. Mr. Cardoso had hinted at a rate increase in previous public appearances in an attempt to cool rising inflation. The apex bank boss also noted that the cash reserve ratio for deposit money banks remains at 45%.
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held its 295th meeting on the 20th and 21st of May 2024 to review recent economic and financial developments and assess risks to the outlook,”
“Decisions of the MPC. The committee’s decisions are as follows: Raise the MPR by 150 basis points to 26. 25 per cent from 24.75 per cent,” the CBN Governor said on Tuesday.
Acknowledging the rising inflation, Cardoso emphasized that the key focus of the MPC meeting was to achieve price stability using available tools. He identified food inflation as a significant driver of overall inflation, citing factors such as rising transportation costs, infrastructure challenges, security issues, and exchange rate fluctuations.
