Nigeria: CBN Raises Benchmark Interest Rate to 24.75%

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In a move to address economic concerns, the Central Bank of Nigeria (CBN) has announced an increase in its benchmark interest rate, the Monetary Policy Rate (MPR), to 24.75%. This marks a significant rise of 200 basis points from the previous rate of 22.75% set in February. The decision was revealed by Mr. Olayemi Cardoso, the Governor of the CBN, following the conclusion of the Monetary Policy Committee (MPC) meeting held in Abuja.

While the MPR saw a notable adjustment, the CBN opted to maintain the Cash Reserve Ratio (CRR) for commercial banks at 45%. However, there was a slight upward adjustment in the CRR for merchant banks, which was raised from 10% to 14%. Additionally, the liquidity ratio for banks remains unchanged at 30%.

In another development, the CBN revised the asymmetric corridor surrounding the MPR from +100/-700 to +100/-300.

Further details regarding the implications and rationale behind these adjustments are expected to be provided later.

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