BREAKING: CBN hikes interest rate to 18.5%

Central Bank of NigeriaThe Reserve Bank of India on Wednesday raised its benchmark lending rate to 18.5 per cent from 18 per cent, to contain inflationary pressure in the country.

The announcement was made by CBN Governor Godwin Emefile on Wednesday after the bank’s Monetary Policy Committee (MPC) meeting that began on Tuesday.

Addressing reporters at the end of the two-day meeting in Abuja, Mr. Emefile said that the committee voted to place the asymmetric corridor around the MPR of +100 and -700 basis points.

He also disclosed that the MPC voted to keep the cash reserve ratio (CRR) at 32.5 per cent, while the liquidity ratio was retained at 30 per cent.

“Ten members voted to increase the MPR by 15 basis points and one member by 25 basis points, and all members voted to keep all parameters constant,” Mr Emefile said.

CRR is the portion of a bank’s total customer deposits that must be kept with the central bank in the form of liquid cash, while a bank’s liquidity ratio is the proportion of deposits and other assets that they must be able to meet short term. obligations.

In January, the MPC raised its benchmark lending rate from 16.5 percent to 17.5 percent to control inflation and ease pressure on the naira.

Also Read: North-Central Caucus Seeks Deputy Senate President’s Seat

Similarly, during the last MPC in March, the CBN aggressively raised its benchmark lending rate to 18 percent to contain the country’s inflationary pressures.

Last week, the annual inflation rate of Africa’s largest economy rose to 22.22 percent in April from 22.04 percent in the previous month. The National Bureau of Statistics (NBS) said that the inflation rate for April 2023 has increased by 0.18 percent compared to the headline inflation rate for March 2023.