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CBN Raises Benchmark Lending Rate To 26.25% As Inflation Defies Cardoso’s Policies

The Central Bank of Nigeria (CBN) has again hiked the Monetary Policy Rate to 26.25 per cent after inflation and naira woes defied the apex bank’s effort to restore investors’ confidence in the economy.

The apex bank governor, Olayemi Cardoso disclosed the decision on Tuesday at the 295th Monetary Policy Committee Meeting in Abuja.

Cardoso said, “The committee’s decision are as follows, to raise the MPR by 150 basis points to 26.25 per cent from 24.75 per cent. (2) Retain Asymmetric Corridor around the MPR to +100 to -300 points.

“Retain the Cash Reserve Ratio of Deposit Money Banks at 45 per cent and retain the Liquidity Ratio at 40 per cent.”

Cardoso blamed inflation for the decision of the committee.

In the last meeting held in March, the apex bank announced a 200 basis point hike in benchmark interest rate to 24.75 per cent from 22.75 per cent.

Cardoso has been battling higher inflation at 33.69 per cent and a volatile naira which trades at N1468.99 against the dollar at the Nigerian Autonomous Foreign Exchange Market on Monday, May 20, 2024.

But the apex bank boss said he is focused on bringing sanity to the foreign exchange market and beating down inflation.

In April, the Acting Director, of the Banking Supervision Department of the CBN, Dr Adetona Adedeji hinted that the bank is paying less attention to policies that will trigger economic growth and employment opportunities because of inflation.

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