Central Bank of Nigeria Yields to Pressure, Schedules Interest Rate Meeting in February

Under mounting pressure, Nigeria's Central Bank has yielded, announcing its inaugural rate hike meeting scheduled for February 26-27, 2024. This marks the first such meeting since July 2023. In December, Governor Yemi Cardoso conceded that monetary transmission mechanisms had significantly hampered the efficacy of rate meetings.

As disclosed in the recently released bank calendar, the CBN is proposing a total of six rate meetings throughout 2024. The Monetary Policy Committee meetings, responsible for determining interest rates, serve as a pivotal tool for the CBN in managing inflation.

Nigeria has witnessed a relentless surge in inflation throughout 2023, reaching a 27-year high. While experts interviewed by TechCabal have consistently predicted interest rate hikes based on inflation figures, Yemi Cardoso had refrained from convening any meetings since assuming office.

Adedayo Bakare, an investment analyst at Money Africa, contends that raising interest rates remains crucial in tackling inflation. Bakare asserts, "MPR is not ineffective; the CBN has disrupted the transmission of MPR to the financial markets and the overall economy."