Central Bank of Nigeria’s Monetary Policy Committee has voted to increase the benchmark interest rate by 50 basis points to 18. percent.
The CBN Governor, Godwin Emefiele, disclosed this on Tuesday when reading the minutes of the second MPC meeting.
He said that the committee set the liquidity ratio at 30% as well.
According to the governor of the top bank, tightening the rate will prevent inflation from rising above its current estimate of 21%.
Emefiele clarified that the bank agrees with the Supreme Court’s ruling regarding the redesign of the naira because there are approximately one trillion of the new notes in circulation.
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 nation’s commercial banks stating that they have remained resilient with the capital requirement at thirteen percent, non-performing loans at four point two percent, and a cash reserve of the banks raising to fourteen trillion naira.