JUST IN: CBN Raises Interest Rates to 22.75% in Fight Against Inflation
The Nigerian Central Bank (CBN) has announced a significant increase in its benchmark interest rate, raising it from 18.5% to 22.75%. This aggressive move aims to curb Nigeria’s rising inflation, which currently stands at 29.9%.
Governor Olayemi Cardoso emphasized the urgency of tackling inflation, stating, “We expect that this will moderate in the short to medium term.” He added that the CBN “is moving to a very aggressive regulatory environment” and will work with other government bodies to address inflationary pressures, particularly addressing insecurity.
The CBN also raised the Cash Reserve Ratio (CRR) to 45%, further tightening its monetary policy stance. Governor Cardoso warned financial institutions to comply with regulations, stating that the bank will “continue to make the market more liquid, warning that operators who are not willing to abide by regulations will face the consequences.”
This significant rate hike marks the first monetary policy adjustment since the MPC’s appointment in September and signifies the CBN’s commitment to addressing Nigeria’s economic challenges. However, the potential impact of this aggressive approach on economic growth and financial stability remains to be seen.
