By Attah Ede
The Central Bank of Nigeria (CBN) on Tuesday made a major policy announcement, cutting its benchmark interest rate significantly.
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) announced that it had reset the Monetary Policy Rate (MPR) to 23 per cent, representing a 350-basis-point cut from the previous rate of 26.5 per cent.
At the conclusion of its 307th Monetary Policy Committee meeting held in Abuja, CBN Governor Olayemi Cardoso announced the surprise interest rate cut amid expectations that rates would be held constant again.
The unexpected and substantial reduction follows consecutive months of moderating inflation and relative stability in the foreign exchange market.
The MPC also recalibrated the standing facilities corridor to +50/-300 basis points around the MPR.
The Cash Reserve Ratio (CRR) was retained at 45 per cent for Deposit Money Banks, 16 per cent for Merchant Banks, and 75 per cent for non-TSA public sector deposits.
