The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has increased the official interest rate by 50 basis point, in a consistent tightening policy measure to tame inflation in Nigeria.
With the new increase in the monetary policy rate, the CBN has capped official interest rate at 18 per cent from 17.5 per cent in January, 2023.
The CBN said the aim was to keep inflation rate under control, citing the gains of previous high rate as reason for its new action.
CBN Governor, Godwin Emefiele, who made the disclosure at an ongoing media briefing on Tuesday to mark the end of this month’s MPC meeting, said although the inflation has remained on the increase, the tightening measure has continued to reduce the rate of price increase.
On naira redesign, Emefiele explained that the bank aligns itself with the Supreme Court’s judgement as currency in circulation (redesigned naira) is about one trillion naira.
He said that the bank will continue to pump more currency into the system but with caution.
The central bank boss expressed confidence in the nations commercial banks stating that they have remained resilient with capital requirement at thirteen percent, non performing loans at four point two percent and cash reserve of the banks raising to fourteen trillion naira.
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