ENUGU, Nigeria (VOICE OF NAIJA)- The Central Bank of Nigeria (CBN), said it has raised the monetary policy rate, known as the interest rate, by 400 basis points from 18.5 per cent to 22.75 per cent.
This was announced by the CBN Governor, Olayemi Cardoso, during the 293rd Meeting of the Monetary Policy Committee press briefing in Abuja.
According to Cardoso, the move was to ensure that the country’s soaring inflation rate, which stood at 29.90 per cent in January, was moderated.
Also, the bank raised the Cash Reserve Ratio to 45 per cent from 32.5 per cent.
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Speaking on the implementation of its policy, he said “We expect that this will moderate in the short to medium term. We intend to work closely with other organs of government to take the fiscal side of the inflation, especially regarding insecurity.
“As far as CBN is concerned, we are moving to a very aggressive regulatory environment.”
The CBN Governor further stated that the bank will continue to make the market more liquid, even as he warned that operators who are not willing to abide by regulations will face the consequences.
The last time the MPC raised interest rates was in July. It MPC held its first Meeting since its appointment in September with a move to tighten monetary policy measures.
The Chief Executive Officer of the Financial Derivatives Company, Bismarck Rewane, had said that the Central Bank Monetary Policy Committee will have no option but to tighten interest rates amid soaring inflation and economic hardship.