In an effort to combat persistent inflation and stabilize the Nigerian economy, the Central Bank of Nigeria (CBN) has increased the Monetary Policy Rate (MPR) to 26.25% from 24.75%
This decision was announced by CBN Governor, Olayemi Cardoso, at a press briefing held in Abuja on Tuesday following the 295th Monetary Policy Committee (MPC) meeting.
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Cardoso said, “The committee’s decisions are as follows: to raise the MPR by 150 basis points to 26.25 per cent from 24.75 per cent. (2) Retain Asymmetric Corridor around the MPR to +100 to -300 points. (3) Retain the cash reserve ratio of deposit money banks at 45% and (4) Retain the liquidity ratio at 30%.”
He noted that members observed that while year-on-year headline inflation in April 2024 rose moderately, the month-on-month measures of headline, food, and coal all declined significantly.
The CBN boss said MPC, however, noted that the inflationary pressure continued to be driven largely by food inflation.
“The committee thus reiterated several challenges confronting the effective moderation of food inflation to include rising costs of transportation of farm produce, infrastructure-related constraints along the line of distribution network, security challenges in some food producing areas, and exchange rate pass-through to domestic prices for imported food items,” Cardoso stated.