CBN Increases Interest Rate To 22.75%

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CBN Increases Interest Rate To 22.75%

The Central Bank of Nigeria (CBN)’s Monetary Policy Committee (MPC) has announced a significant increase in the Monetary Policy Rate (MPR), raising it by four hundred basis points to 22.75% from the previous rate of 18.75%.

CBN Governor Yemi Cardoso revealed the decision after Tuesday’s first MPC meeting of the year in Abuja.

In addition to the MPR adjustment, the MPC raised the Cash Reserve Ratio (CRR) to forty-five per cent. However, the liquidity ratio remained unchanged at thirty per cent.

The move suggests tightening monetary policy to address various economic challenges and ensure stability.

The MPC’s decisions shape the country’s monetary and financial environment.

This development will likely have implications for Nigeria’s interest rates, lending practices, and overall economic activities.

Cardoso said adjusting the MPR and other policy rates is part of the CBN’s ongoing efforts to navigate the country’s economic landscape and promote sustainable growth.

“We are moving to a very aggressive regulatory era. And players must comply because the consequences will be dire.

“We are going to ensure that the economy is highly liquid, but the money will only get to genuine players in the economy,” Cardoso said.

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By Abia ThinkTank

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