The Central Bank of Nigeria Monetary Policy Committee has implemented a significant increase in interest rates, raising them by 150 basis points from 24.75 per cent to 26.25 per cent in March.
This decision was announced by CBN Governor, Olayemi Cardoso, during the 295th MPC press briefing held in Abuja.
The primary objective behind this move was to address the escalating inflation rate in the country, which had surged to 33.69 per cent in April.
The CBN has been actively employing tighter monetary measures to combat inflation, and the decision to raise interest rates is a continuation of these efforts.
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By increasing the cost of borrowing, the central bank aims to curb excessive spending and reduce the overall demand for goods and services, thereby stabilizing prices and mitigating inflationary pressures.
This latest adjustment marks the third interest rate hike since Olayemi Cardoso assumed the position of CBN Governor in September of the previous year.
Prior to this recent increase, Nigeria’s interest rate in May 2023 stood at 18.75 per cent.
The significant jump to 26.25 per cent reflects the central bank’s determination to address the mounting inflationary challenges faced by the country.
By taking decisive action to tighten monetary policy, the CBN aims to restore stability to the economy and foster an environment conducive to sustainable growth and development.
