By Yomi Omolade, JKNewsMedia Intern
THE MONETARY Policy Committee of the Central Bank of Nigeria (CBN) has reduced the benchmark interest rate by 50 basis points, lowering it from 27.5 percent to 27 percent.
Governor Olayemi Cardoso made the announcement while briefing journalists on the outcome of the 302nd meeting of the Monetary Policy Committee held in Abuja on Tuesday.
He stated that the decision marked the first reduction in the Monetary Policy Rate in five years.
Cardoso explained that the adjustment followed a moderation in inflation and was aimed at supporting economic growth.
According to him, the committee considered the recent improvements in GDP performance and easing inflationary pressures in its decision to begin a phase of monetary easing.
He further disclosed that the cash reserve requirement for commercial banks had been adjusted to 45 per cent, while the ratio for merchant banks would remain at 16 per cent.
Cardoso also announced the introduction of a 75 per cent cash reserve ratio on non-Treasury Single Account public sector deposits.
The governor emphasised that the measures were intended to balance price stability with economic expansion, noting that the cut in interest rates represented a cautious but deliberate step by the Central Bank towards easing monetary conditions.
According to the Central Bank, the reduction of the Monetary Policy Rate to 27 per cent reflects an effort to stimulate lending and economic activity, while maintaining a watch on inflation dynamics.
Cardoso reiterated that the committee would continue to monitor economic indicators to ensure stability within the financial system.
