CBN Increases Monetary Policy Rate To 27.50%

The Central Bank of Nigeria (CBN) has increased the Monetary Policy Rate (MPR) by 250 basis points, from 27.25% to 27.50%.

This decision was made during the 298th meeting of the Monetary Policy Committee (MPC), as confirmed in a statement issued by the CBN on Tuesday.

In addition to the MPR hike, the MPC also decided to maintain the Cash Reserve Ratio (CRR) at 50% for Deposit Money Banks and 16% for Merchant Banks. The Liquidity Ratio (LR) was kept at 30%, while the Asymmetric Corridor remained at +500/-100 basis points around the MPR. The decision was unanimous among the committee members.

The meeting, chaired by CBN Governor Olayemi Cardoso, also highlighted the importance of enhanced collaboration between monetary and fiscal authorities to achieve greater price stability. The MPC noted that the rising cost of petrol continues to affect manufacturers’ production costs, which remains a concern for the economy.

In a separate development, the CBN has issued instructions to commercial banks, directing them to prioritize cash disbursements through automated teller machines (ATMs). The apex bank warned that any banks failing to comply with this directive would face penalties.

The statement, signed by Solaja Olayemi, the Acting Director of the Currency Operations Department at the CBN, was issued amid reports of cash scarcity, which has disrupted transactions across the country.

The CBN also issued a caution against supplying naira notes to individuals or groups involved in the illegal hawking of currency. The bank has begun conducting spot checks to ensure that cash disbursement is being carried out efficiently and responsibly, and to prevent the distribution of newly minted banknotes to those engaged in the illegal trade of currency.

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