Naira Scarcity: CBN to release more money into circulation with caution –Emefiele

*The Central Bank of Nigeria has increased the benchmark Interest Rate by 50 basis points to 18 percent, with liquidity ratio at 30 percent

Alexander Davis | ConsumerConnect

The Monetary Policy Committee of the Central Bank of Nigeria (CBN) has increased the benchmark interest rate by 50 basis points to 18 percent.

Mr. Godwin Emefiele, Governor of CBN, noted this development Tuesday, March 21, 2023, when announcing the communiqué of the second MPC meeting in the year.

Emefiele said the MPC as well fixed the liquidity ratio at 30 percent.

The Governor of CBN disclosed the tightening of the rate is expected to curtail inflation currently put at 21 percent in the Nigerian economy.

Speaking on the Naira redesign project, Emefiele further explained that the Bankers’ Bank has aligned itself with the Supreme Court’s judgement, as currency in circulation is about a  trillion Naira as of now.

The CBN, however, will continue to pump more currency into the system but with caution, stated he.

As regards how the Nigerian banks are faring currently, the CBN Chief expressed confidence in the West African country’s Deposit Money Banks (DMBs).

He declared the financial institutions have remained resilient with capital requirement at 13 percent, Non-Performing Loans (NPLs) at four point two percent, and Cash Reserve of the banks hitting N14 trillion.