The Monetary Policy Committee of the Central Bank of Nigeria has reduced the country’s benchmark interest rate to 27.00 per cent, the first cut in 2024 after three consecutive pauses, signalling a shift in policy towards supporting economic recovery.
While welcoming the move, members of the Organised Private Sector argued that the reduction remains marginal and insufficient to ease the credit squeeze on manufacturers and small businesses.
Announcing the decision at a press briefing on Tuesday in Abuja after the committee’s 302nd meeting, CBN Governor Olayemi Cardoso said all 12 members voted in favour of a 50-basis point cut from 27.5 per cent.
The committee also adjusted the Standing Facilities corridor to +250/-250 basis points, raised the Cash Reserve Requirement for commercial banks to 45 per cent while retaining merchant banks at 16 per cent, and introduced a 75 per cent CRR on non-TSA public sector deposits.
Cardoso explained that the decision was underpinned by “sustained disinflation recorded in the past five months, projections of declining inflation for the rest of 2024, and the need to support economic recovery efforts.”
