The Central Bank of Nigeria Monetary Policy on Tuesday cut interest rates by 50 basis points to 27 per cent.<\/p>\n
The move brings excitement to businesses as Nigerians push for a reduction in the cost of living.<\/p>\n
Interestingly, the latest Monetary Policy Rate cut is the first since 2020, the Covid-19 period.<\/p>\n
Announcing the interest rate reduction, Olayemi Cardoso said the Monetary Policy Committee based its decision on the improved prevailing macroeconomic reality in Nigeria.<\/p>\n
Like MPR, MPC also adjusted the Cash Reserve Ratio, CRR, to 45 per cent for Deposit Money Banks and 16 per cent for Merchant Banks, and introduced a 75 per cent CRR on Non-TSA deposits.<\/p>\n
It also adjusted the asymmetric corridor at +250\/-250 basis points around the MPR.<\/p>\n
The committee retained the Liquidity Ratio, LR, at 30 per cent.<\/p>\n
Cardoso cited indicators including the fifth consecutive disinflation of the country\u2019s headline inflation (21.12 per cent in August), a stable exchange rate (N1,487.37 per dollar on Tuesday at the official market) and robust external reserves, which stood at $42.13 billion in September 2022.<\/p>\n
\u201cThese include the sustained disinflation, improved output growth, stable exchange rate, and robust external reserves,\u201d Cardoso stated on Tuesday in a briefing after its 302nd MPC meeting in Abuja.<\/p>\n
The decision immediately triggered the Naira\u2019s appreciation at the money market, but the Nigerian Exchange Market closed bearish, with investors losing N322 billion on Tuesday.<\/p>\n
MPR cut supports growth, investment \u2013 CPPE<\/p>\n
Reacting, the Centre for the Promotion of Private Enterprise, in a statement by its Chief Executive Officer, Muda Yusuf, said the easing of monetary measures is a significant policy shift towards supporting growth and investment in the Nigerian economy.<\/p>\n