The Central Bank of Nigeria (CBN) has increased the Monetary Policy Rate (MPR) from 27.25% to 27.50% in a bid to address rising inflation. This decision was made during the Monetary Policy Committee (MPC) meeting held at the CBN headquarters in Abuja, marking the final meeting of the year.

CBN Governor Yemi Cardoso, who announced the decision on Tuesday, stated that the committee unanimously agreed to raise the MPR by 25 basis points while retaining the Cash Reserve Ratio (CRR) at 50% for Deposit Money Banks and 16% for Merchant Banks. The Liquidity Ratio (LR) remains at 30%, and the Asymmetric Corridor at +500/-100 basis points around the MPR.

“The committee unanimously agreed to raise the monetary policy rate to 27.50% to address the renewed inflationary pressures, particularly the year-on-year increases in headline, food, and core inflation rates observed in October 2024,” Cardoso explained.

This marks the sixth-interest rate hike by the CBN in 2024. In September, the rate was adjusted to 27.25% following a temporary dip in inflation. However, the National Bureau of Statistics (NBS) reported inflation rising to 33.88% in October, up from 32.7% in September, citing higher transportation and food costs.

On a year-on-year basis, the inflation rate for October 2024 increased by 6.55 percentage points compared to 27.33% in October 2023, further underscoring the challenges the CBN aims to tackle with its monetary policy adjustments.