Interest rate rises to 24.75%
The Monetary Policy Committee (MPC), after its meeting in Abuja, announced a significant hike in the benchmark interest rate. The decision, accompanied by adjustments to reserve requirements for banks, aims to tighten control over the money supply and stabilise prices. CBN Governor Yemi Cardoso reiterated its commitment to maintaining price stability and fighting inflation. He stressed the need for strict adherence to the core mandate of the central bank, including maintaining purchasing power. According to Cardoso, the Committee raised the Monetary Policy Rate (MPR) by 200 basis points to 24.75 per cent from 22.75 per cent (which was fixed at the February 27 meeting of the MPC). It adjusted the asymmetric corridor around the MPR to +100/-300 basis points and retained the Cash Reserve Ratio of Deposit Money Banks at 45.0 per cent. The committee adjusted the Cash Reserve Ratio of merchant banks from 10.0 to 14.0 per cent and retained the liquidity ratio at 30.0 per cent. The CBN anticipates a gradual moderation of inflation rates by May, with measures in place to foster economic growth while maintaining price stability. The committee called for the full implementation of agricultural policies to enhance food supply and urged broader fiscal consolidation to improve tax collection.
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