Amidst the ongoing economic challenges, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has taken decisive action to address the situation. The committee has raised the benchmark interest rate (MPR) by 25 basis points, bringing it to 18.75% from its previous rate of 18.5%.
The announcement was made by the acting CBN governor, Folashodun Shonubi, during a press briefing following the conclusion of the two-day MPC meeting on Tuesday, July 25, 2023. This meeting was the first one chaired by the new acting CBN governor, after the suspension of Godwin Emefiele.
The decision to increase the interest rate was driven by the escalating economic challenges confronting the nation. The CBN aims to counter inflationary pressures and stabilize the value of the national currency. By raising the interest rate, the central bank seeks to promote savings and reduce borrowing, which can effectively control inflation and bolster the domestic currency against external pressures.
Acting Governor Shonubi acknowledged the severity of the current economic situation and reassured the public that the CBN remains dedicated to implementing measures that will foster sustainable economic growth while ensuring price stability.
This move by the CBN is likely to have significant ramifications on Nigeria’s financial landscape, affecting businesses, borrowers, and consumers alike. Economists and market analysts will closely monitor the impact of this policy change on inflation, investment, and overall economic performance.
The CBN has committed to maintaining vigilance and adjusting its monetary policy as needed to address the evolving economic challenges and safeguard the financial stability of the nation.
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