APA – Lagos (Nigeria)
The Central Bank of Nigeria (CBN) has announced that its
Monetary Policy Committee (MPC) has voted to increase the benchmark interest rate by 50 basis points to 18. percent.
The Governor of the CBN, Mr. Godwin Emefiele, told journalists after the meeting of the MPC on Tuesday in Abuja that the committee also pegged the liquidity ratio at 30 percent and “retain asymmetric corridor at +100 and -500 basis points around the MPR”.
The MPR has been on the rise since April 2022, when it was 11.50 per cent.
The rate impacts lending and inflation rates, and, when jacked up, consequently affects upward movement of prices of goods and services.
According to Emefiele, the tightening of the rate is expected to curtail inflation currently put at 21 percent.
Speaking on the controversial naira redesign, Emefiele explained that the bank aligns itself with the Supreme Court’s judgment as currency in circulation (redesigned naira) is about one trillion naira.
He said that the bank would continue to pump more banknotes into the system, but with caution.
Emefiele also expressed confidence in Nigerian commercial banks, adding that the banks have remained resilient with capital requirement at 13 percent, non performing loans at 4.2 percent and cash reserve of the banks raising to N14 trillion.
GIK/APA