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  • JUST IN: CBN Increases Interest Rate To 18.5%

    JUST IN: CBN Increases Interest Rate To 18.5%

    The Central Bank of Nigeria (CBN) has raised the interest rate from 18 percent to 18.5 percent.

    The apex bank governor, Godwin Emefiele, announced the decision on Wednesday after the policy-setting committee meeting at the CBN headquarters in Abuja.

    The development is the third consecutive time the apex bank will be raising the monetary policy rate (MPR) which measures the interest rate.

    This is coming a week after the Nigerian Bureau of Statistics revealed that the country’s inflation rate for the month of April hit 22.22% surpassing last month’s rate of 22.04%.

    According to the report, in April 2023, the headline inflation rate rose to 22.22% relative to March 2023 headline inflation rate which was 22.04%. Looking at the movement, the April 2023 inflation rate showed an increase of 0.18% points when compared to March 2023 headline inflation rate.

    This marks the third consecutive time the apex bank will be raising the benchmark rate this year.

  • CBN Increases Interest Rate To 18%

    CBN Increases Interest Rate To 18%

    Central Bank of Nigeria’s Monetary Policy Committee has voted to increase the benchmark interest rate by 50 basis points to 18. percent.

    This was disclosed by the CBN Governor, Godwin Emefiele, on Tuesday while reading the communiqué of the second MPC meeting.

    He said the committee also pegged the liquidity ratio at thirty percent.

    The tightening of the rate according to the apex bank governor is expected to curtail inflation currently put at twenty-one percent.

    On naira redesign, Emefiele explained that the bank aligns itself with the Supreme Court’s judgement as currency in circulation (redesigned naira) is about one trillion naira.

    He said that the bank will continue to pump more currency into the system but with caution.

    The central bank boss expressed confidence in the nations commercial banks stating that they have remained resilient with capital requirement at thirteen percent, non performing loans at four point two percent and cash reserve of the banks raising to fourteen trillion naira.

  • Banks lending rate to customers hits 29.13%

    Banks lending rate to customers hits 29.13%

    The maximum lending rate in the banking sector hit 29.13 per cent while savings deposit rates was 4.13 per cent as of the end of December 2022.

    Figures obtained from the Central Bank of Nigeria on money market indicators revealed on Monday.

    According to the report, prime lending rate was 13.85 per cent, while inter-bank call rate was 12 per cent.

    Treasury bill rate was 4.35 per cent, one month deposit rate was 8.15 per cent, three months deposit rate was 3.79 per cent, six months deposit rate was 8.68 per cent, while 12 months deposit rate was 8.22 per cent.

    Monetary Policy Rate stood at 16.5 per cent in the period under review.

    The National Institute of Credit Administration stated in its report blueprint report for growth, development and sustainability of micro, small, medium size enterprise sector in Nigeria that there was need to support businesses with single digit loans as high interest rates was affecting economic growth.

    It stated that, “The higher the Monetary Policy Rate, the higher the interest rate charged on loans and lines of credits offered to MSMEs in the country. High interest rate is an albatross to any MSME.”

    NICA said many MSMEs were contending with several economic factors while running their ventures.

    Banks battle new naira shortage ahead deadline
    It stated, “Because of the scale and wherewithal of the MSMEs, these factors have significant impact on their profitability. Thus, not to further aggravate the problems, it is pertinent for MSMEs to have ‘Not too difficult’ access to single digit loans. CBN in conjunction with the developmental banks should create more sector-specific funds which MSMEs can access at single digits and without so much difficulties or strenuous conditions.”

    “Federal government can jump start growth and development in the MSME sector by implementing targeted tax incentive policies.

    “While this may immediately lead to reduction in revenue generation of the government particularly in this dire period of dwindling government revenue, the medium to long term benefits on the economy cannot be over-emphasised. Federal Government can give tax incentives in specific areas.”

    According to the report, the Monetary Policy refers to the specific actions taken by the Central Bank to regulate the value, supply and cost of money in the economy with a view to achieving government’s macroeconomic objectives while for others they are not.

    It stated that the objectives of monetary policy may vary from country to country but there were two main views.

    “The first view calls for monetary policy to achieve price stability, while the second view seeks to achieve price stability and other macroeconomic objectives,” it stated.

    It stated that the CBN, like other central banks in developing countries, achieved the monetary policy goal through the amount of money supplied.

    According to the report, “The policy interest rate determines the levels of the rest of the interest rates in the economy, since it is the price at which banks-obtain money from the CBN. These banks will then offer financial products to the MSMEs at an interest rate that is normally based on the policy rate.”

  • CBN Raises Interest Rate To 17.5%

    CBN Raises Interest Rate To 17.5%

    The Central Bank of Nigeria (CBN) has raised the Monetary Policy Rate (MPR), which measures interest rate from 16.5% to 17.5 percent to tame inflation.

    The CBN Governor, Godwin Emefiele announced this after the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja on Tuesday.

    The MPC raised the monetary policy rate by 100 basis point to 17.5% and kept the asymmetric corridor at +100/-700 basis points around the MPR.

    The MPC retained Cash Reserve Ratio (CRR) by 32.5% while liquidity ratio is kept at 30%.

    Emefiele said MPC “members welcome the recent deceleration of the year-on-year headline inflation, noting that the persistence in policy rate hike over the last few meetings of the committee have started to yield the expected decline in inflation.”

    The CBN governor said the committee considered perennial scarcity of Premium Motor Spirit known as petrol, the 2023 general elections, continuous rise in energy prices, exchange rate pressure as well as continuous rise in insecurity.

    He said committee members noted that the naira redesign has huge moderating factors to price development on cash.

    Announcing the committee’s decision, Emefiele said, “MPC was of the view that although inflation rate moderated marginally in December, the economy remained confronted with the risk of high inflation with adverse consequences on the general standards of living.

    “Committee, therefore, decided to sustain the current stance of policy at this point in time to further rein in inflation aggressively.

    “MPC voted to raise the MPR to 17.5%, retain the asymmetric at +100/-700 basis points around the corridor.”

    The CBN also said its January 31, 2023 deadline for the validity of the old N200, N500 and N1,000 notes remains.

    The CBN on October 26, 2022 had announced its plan to redesign the three banknotes. President Muhammadu Buhari subsequently unveiled the redesigned N200, N500 and N1,000 notes on November 23, 2022, while the apex bank fixed January 31 deadline for the validity of the old notes.

    The CBN also pegged its weekly cash withdrawal limits to N500,000 for individuals and N5m for corporate firms.

    There have been concerns from many Nigerians over the slow spread of the three new naira notes as the January 31 2023 deadline approaches but the apex bank has insisted that the date stands.

    The CBN also recently directed commercial banks to halt over-the-counter payment of the new notes and load their Automated Teller Machines (ATMs) with the redesigned naira notes to boost circulation.

    The apex bank also launched a cash swap programme nationwide to enable those in the unbanked areas to exchange their old notes for new notes before the deadline.

    However, the House of Representatives, the Senate and the Nigeria Governors’ Forum have asked the CBN to extend the date to enable more Nigerians get the new notes.

  • CBN Raises Interest Rate to 16.5% To Battle Inflation

    CBN Raises Interest Rate to 16.5% To Battle Inflation

    The Central Bank of Nigeria, CBN has raised its interest rate to 16.5 per cent in a bullish move to stymie rising inflation and pressure on the naira, the country’s currency.

    The governor of the Central Bank of Nigeria CBN, Godwin Emefiele made this disclosure on Tuesday at the end of the Monetary Policy Committee meeting in Abuja.

    The apex had increased the interest rate to 14 per cent months ago.

    According to Emefiele, the move yielded requisite results on the country’s economy.

    Mr Emefiele announced that the committee also retained the Cash Reserve Ratio (CRR) at 32.5 per cent, and voted to retain the asymmetric corridor at +100 and -700 basis points around the MPR. The liquidity ratio was retained at 30 per cent.

    He added that the global inflationary pressure was quite high and there was a need to moderate the increasing inflationary concerns.

    He further disclosed that the MPC did not consider the need to loosen the rates due to the prevailing circumstances although he said there were indications previous decisions to hold increase rates were beginning to yield results.

    Cash Reserve Ratio is the share of a bank’s total customer deposit that must be kept with the central bank in the form of liquid cash, while Bank Liquidity Ratio is the proportion of deposits and other assets they must maintain to be able to meet short-term obligations.

    Earlier in the year, the CBN had raised the cash reserve requirement (CRR) to a minimum of 32.5% in a bid to mop-up liquidity.

    In October, DAILY POST reported that Nigeria’s inflation rate hit a 17-year high of 21.09% amid soaring prices of food and energy.

    CBN hopes that raising rates will reduce the money supply in the economy and rein in inflation, but some analysts also said that the move also faces the risk of slowing economic growth.

    A higher interest rate will raise the cost of borrowing for businesses and may make goods and services even more expensive for consumers as the Yuletide season approaches.

  • CBN Increases Interest Rate To 15.5%

    CBN Increases Interest Rate To 15.5%

    The Central Bank of Nigeria has raised the Monetary Policy Rate (MPR), which measures interest rate, to 15.5 percent from 14 percent.

    CBN Governor, Godwin Emefiele, made this known on Tuesday after a Monetary Policy Committee meeting in Abuja.

    Emefiele said, “The committee voted unanimously to raise the MPR…The MPC voted to raise the MPR to 15.5, retain the asymmetric corridor at +100 -700 basis points around the MPR. Increase the Cash Reserve Ratio (CRR) to a minimum of 32.5% and retain liquidity ratio at 30%.”

    Giving an explainer earlier, the apex bank’s governor said, “Members deliberated the impact of the widening margin between the current policy rate of 14 percent and the inflation rate of 20.52 percent.

    “At this meeting, the option of reducing the policy rate was not considered as this would be gravely detrimental to reigning in inflation. The committee thus agreed unanimously to raise the policy rate to narrow the interest rate gap and reign in inflation. The committee thus voted unanimously to raise the MPR.

    “10 members voted to raise the MPR by 150 basis points, one (voted to raise it) by 100 basis points and one by 50 basis points. 10 members voted to increase CRR (Cash Reserve Ratio) by 500 basis points, while two members voted to increase it by 750 basis points.”

    More to follow…

  • JUST IN: CBN Retains Benchmark Interest Rate At 11.5%

    JUST IN: CBN Retains Benchmark Interest Rate At 11.5%

    The Central Bank of Nigeria’s Monetary Policy Committee has retained the Monetary Policy Rate (MPR) at 11.5% and kept all other parameters unchanged.

    CBN Governor Godwin Emefiele made the announcement while addressing journalists on Monday.

    The MPR, which has remained unchanged for months, is a tool for regulating interest rates in the economy.

    Lowering the rate could have stimulated more borrowing while raising the rate could have signaled the CBN’s intention to reduce the economy’s money supply.

    More to follow . . .

  • Russia’s Central Bank holds interest rate at 20%, warns of inevitable inflation

    Russia’s Central Bank holds interest rate at 20%, warns of inevitable inflation

    The Central Bank of Russia (CBR) held its monetary policy steady and maintained its key interest rate at 20%, but warned of considerable uncertainty as the economy would lead to an inevitable inflationary period.

    This was confirmed in a statement issued by the CBR, which was seen by Nairametrics.

    The apex bank has increased the country’s key interest rate from 9.5% to 20% in late February, just after Russian soldiers invaded Ukraine, to support the country’s plummeting currency and soften the impact of strong international sanctions.

    The policy of maintaining a high-interest rate was implemented in the face of a significant shift in external conditions(war); the sudden increase in the Bank of Russia key rate on February 28 helped to maintain financial stability and prevent uncontrollable price increases.

    What the Russian Central Bank is saying
    It stated, “On 18 March 2022, the Bank of Russia Board of Directors decided to keep the key rate at 20% per annum.

    “The Russian economy is entering the phase of a large-scale structural transformation, which will be accompanied by a temporary but inevitable period of increased inflation, mainly related to adjustments of relative prices across a wide range of goods and services.”

    The Bank also acknowledged how that war in Ukraine has shocked Russia Financial Markets.

    “The drastic change in external conditions for the Russian economy that occurred at the end of February has created threats to financial stability. The Bank of Russia’s decision to increase in the key rate on 28 February and capital controls helped support the stable functioning of the Russian financial system,” it added.

    Amid the rising tension, the Russian bank disclosed plans to push its inflation rates to their intended levels, “the Bank of Russia’s monetary policy is set to enable a gradual adaptation of the economy to new conditions and a return of annual inflation to 4% in 2024.”

    GDP is expected to fall in the future quarters, according to Bank of Russia projections. The supply-side variables will drive this drop, resulting in a minor disinflationary effect. The government’s and the Bank of Russia’s stimulus efforts will reduce the severity of the economic crisis. The degree and speed with which the Russian economy adjusts to new conditions will have a significant impact on its future recovery path.

  • CBN opposes lockdown, retains interest rate at 11.5%

    CBN opposes lockdown, retains interest rate at 11.5%

    The Monetary Policy Committee (MPC) of the Central Bank of Nigeria on Tuesday urged the Federal Government not to consider another round of lockdown.

    CBN Governor Godwin Emefiele made this known in Abuja at the end of the first MPC meeting in 2021.

    The CBN governor said the Bank will work with the fiscal authorities to revamp the economy by collaborating on policy implementation.

    Emefiele also disclosed that the CBN has secured approval from President Muhammadu Buhari to restructure the Nigeria Commodity Exchange.

    The CBN governor said the Bank can no longer sit back and watch unscrupulous commodity merchants hoard commodities and force the prices of commodities to be high.


    According to Emefiele, the CBN owns 60 percent of the Nigeria Commodity Exchange and it will take charge of running the exchange to international standard

    At the end of the meeting, Godwin Emefiele, announced that the committee unanimously agreed to retain the current monetary policy stance by leaving Monetary Policy Rate (MPR) at 11.5 percent and retain the Cash Reserves Ratio at 27.5 per cent.

    Also retained are the Liquidity Ratio which was left at 30 per cent; and the Asymmetric corridor which was left at +100 and -700 basis points around the MPR.

    Details shortly…