The Central Bank of Nigeria (CBN) has returned the interest rate on all its interventions back to nine per cent – from five per cent a circular that was released by the apex bank yesterday, indicated.
The bank had on March 15, 2022 extended the period of interest rate reduction on all intervention facilities from nine per cent to per cent per annum.
The central bank introduced the reduction in the interest rate as part of measures to mitigate the negative impact of COVID-19 pandemic on the Nigerian economy.
However, analysts believe the reversal of the earlier reduction in interest rate is due to the persistent rise in inflation rate in the country.
“The Central Bank of Nigeria hereby reverts the interest rate on all its intervention facilities to 9 per cent per annum,” a circular that was signed by Chibuzo Efobi, director, financial policy and regulatory department of the bank.
Efobi said the revised rate will be implemented on all intervention facilities granted effective July 20, 2022 – 9 percent per annum and all existing intervention facilities granted prior to July 20, 2022 shall be at 9 per cent per annum effective September 1, 2022.
Recall that the CBN had on Tuesday reviewed upward minimum interest payable savings account to 30 per cent of the Monetary Policy Rate (MPR), which is 4.2 per cent per annum.
Governor of the CBN, Godwin Emefiele had said the Monetary Policy Committee (MPC) will continue to raise benchmark interest rates as long as inflationary pressures continue even as the members further tightened rates by 100 basis to 14 per cent.
After hiking benchmark rate by 150 basis points at its meeting in May, the MPC had in July once again raised benchmark rate by 100 basis points from 13 per cent to 14 per cent.
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