The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has raised the benchmark interest rate by 200 basis points to 24.75 percent.
CBN governor Yemi Cardoso announced this in a communique after the second MPC meeting of his tenure in Abuja.
The new rate is the second rate hike by the current committee. It is a jump from the 22.75 percent earlier announced by the MPC.
The committee retained the liquidity ratio at 30 percent.
Cardoso announced the retention of the Cash Reserve Ratio (CRR) of deposit money banks at 45 percent. However, the MPC adjusted the CRR of merchant banks from 10 percent to 14 percent.
“The considerations of the committee at this meeting focused on the current inflationary pressures and the need to anchor inflation expectations as well as ensure sustained exchange stability,” Cardoso said.
The CBN governor said the moves are part of efforts to combat rising inflationary rate which was pegged at 31.70 percent in February.
Cardoso noted that MPC members believe the headline inflation in the country is triggered mostly by a hike in the cost of food.
He recommended that addressing food insecurity is key to containing the current inflationary pressures and commended the Federal Government’s efforts at curbing food insecurity.
The CBN governor also gave an update on the ongoing clampdown on Binance and other cryptocurrency platforms in the country.
Cardoso said the CBN is collaborating with other agencies of government to achieve ‘success’ but noted that it is not within the role of the CBN to regulate cryptocurrency transactions.
“The NSA, we’ve been sharing information together. However, in this particular case, the responsibility for regulating cryptocurrency is not our role, it isn’t ours; it is strictly that of the Security and Exchange Commission, not our responsibility,” Cardoso said.
The next MPC meeting will be held between the 20th and 21st of May, 2024.
