In a decisive move aimed at stabilizing the economy, the Central Bank of Nigeria (CBN) has announced a significant increase in the Monetary Policy Rate (MPR) by 200 basis points, bringing it to 24.75% from 22.75%.
This decision was reached at the conclusion of the two-day meeting of the Monetary Policy Committee (MPC) for March 2024.
The MPC, in its 294th meeting, also decided to widen the asymmetric corridor to +100bps/-300 basis points.
Additionally, the Committee opted to maintain the Cash Reserve Ratio (CRR) of Deposit Money Banks at 45%, while adjusting the CRR of Merchant banks from 10% to 14%.
This move signals the CBN’s commitment to addressing inflationary pressures and maintaining financial stability amid prevailing economic challenges.
The decision to raise the interest rate reflects the bank’s proactive stance in curbing inflationary trends and ensuring sustainable economic growth.
The CBN’s retention of a liquidity ratio of 13% underscores its efforts to manage liquidity in the banking system effectively.
Market analysts anticipate that the revised monetary policy measures will impact borrowing costs and investment decisions in the financial landscape.
Stay tuned for further updates and expert analysis on the implications of the CBN’s latest policy adjustments.