The Central Bank of Nigeria, CBN, has raised its interest rate by 50 basis points to 27.25%, marking the fifth consecutive hike since February 2024.
This decision was announced by CBN Governor Olayemi Cardoso at the end of the 297th Monetary Policy Committee, MPC, meeting in Abuja.
Cardoson disclosed that in addition to the interest rate hike, the Cash Reserve Ratio, CRR, for Deposit Money Banks, DMBs, has been increased from 45% to 50%, and for Merchant Banks from 14% to 16%.
He said the Liquidity Ratio, LR, remains unchanged at 30%, and the Asymmetric Corridor stays at +500/-100 basis points around the MMP.
Cyber Reporters gathered that this rate hike comes despite Nigeria’s inflation rate easing for the second consecutive month in August to 32.15% .
The CBN’s move also contrasts with the United States Federal Reserve’s recent 0.5% interest rate cut.
Some experts, like Economist Muda Yusuf, had advised the CBN to pause interest rate hikes.
Cyber Reporters also gathered that since February 2024, the CBN has raised interest rates four times, from 22.75% to 26.75%.
Under Governor Cardoso’s leadership, which began in September last year, interest rates have increased by 8.5%.
