In a wait-and-see approach, the Central Bank of Nigeria (CBN) on Tuesday retained its benchmark interest rate, known as the Monetary Policy Rate (MPR), at 27.5 percent, despite slowing inflation and sluggish economic growth.
Olayemi Cardoso, CBN governor disclosed this after the two-day Monetary Policy Committee (MPC) meeting held in Abuja. He said the Committee was unanimous in its decision to hold policy parameters steady in order to properly assess the impact of previous tightening measures.
The MPC resolved to retain the MPR at 27.50 percent. It also maintained the asymmetric corridor around the MPR at +500/-100 basis points, kept the Cash Reserve Ratio (CRR) for Deposit Money Banks at 50.00 percent and for Merchant Banks at 16 percent, and left the Liquidity Ratio unchanged at 30.00 percent.
Olayemi Cardoso, CBN governor disclosed this after the two-day Monetary Policy Committee (MPC) meeting held in Abuja. He said the Committee was unanimous in its decision to hold policy parameters steady in order to properly assess the impact of previous tightening measures.
The MPC resolved to retain the MPR at 27.50 percent. It also maintained the asymmetric corridor around the MPR at +500/-100 basis points, kept the Cash Reserve Ratio (CRR) for Deposit Money Banks at 50.00 percent and for Merchant Banks at 16 percent, and left the Liquidity Ratio unchanged at 30.00 percent.
CBN Cuts interest rate first time in five years to spur growth.
In a surprise move, the Central Bank of Nigeria (CBN) on Tuesday cut its benchmark interest rate, known as the Monetary Policy Rate (MPR), for the first time in five years to …….. percent, in a bid to stimulate economic growth amid easing inflationary pressure.
The decision was announced by Olayemi Cardoso, CBN governor after the conclusion of the two-day Monetary Policy Committee (MPC) meeting in Abuja. The last time the CBN reduced the MPR was in September 2020, when it was lowered from 12.5 percent to 11.5 percent to support the economy during the COVID-19 pandemic.
Since that time, the apex bank had mostly pursued a tightening cycle, raising interest rates in response to elevated inflation. Most recently, in May 2024, the MPR was hiked to 26.25 percent to rein in inflation and support exchange rate stability.
Despite this new cut, the CBN maintained key monetary tools including the MPR at …….. percent, retained the asymmetric corridor at +500/-100 basis points, kept the Cash Reserve Ratio at 50.00 percent for Deposit Money Banks and 16 percent for Merchant Banks, and left the Liquidity Ratio unchanged at 30.00 percent.
