CBN Raises Benchmark Interest Rate to 17.50%, Keeps Others Intact

By Dipo Olowookere

The Central Bank of Nigeria (CBN) has increased the benchmark interest rate in the country by 100 basis points to 17.50 per cent from 16.50 per cent.

The Governor of the central bank, Mr Godwin Emefiele, announced this development on Tuesday afternoon.

While addressing newsmen today at the end of the two-day Monetary Policy Committee (MPC), Mr Emefiele said the team felt it was necessary to raise the rate by 1 per cent.

According to him, the committee was impressed with the effect of the last increment in the Monetary Policy Rate (MPR) by 100 basis points last November, which helped to bring down inflation last month to 21.34 per cent from 21.47 per cent.

However, he stated that it was agreed that other rates should be left intact.

As a result, the Cash Reserve Ratio (CRR) was maintained at 32.50 per cent, the asymmetric corridor around the MPR was left at +100/-700bps, and the Liquidity Ratio (LR) was kept at 30.0 per cent.

Business Post recalls that in 2022, to fight red-hot inflation, the MPC increased the anchor interest rate by 5 per cent by raising the rate in May by 1.50 per cent to 13.00 per cent, increased by 1.00 per cent in July to 14.00 per cent, raised again by 1.00 per cent in September to 15.50 per cent, and by 1.00 per cent in November to 16.50 per cent.