IMF backs Central Bank of Nigeria rate cut to 23 per cent

The International Monetary Fund has endorsed the decision by the Central Bank of Nigeria to lower its benchmark interest rate to 23 per cent. Punch Newspapers reported that the IMF described the move as justified due to recent progress in reducing inflation across the country. [1]

Zeine Ould Zeidane, director of the IMF African Department, stated at the IMF World Bank Annual Meetings in Thailand that Nigeria achieved gains after facing high price pressures. Punch Newspapers reported that Zeidane supported the central bank beginning to normalise interest rates while keeping monetary policy tight. [1]

Reports from Vanguard News, The Nation Newspaper, MarketForces Africa, and LEADERSHIP Newspapers similarly noted that the IMF viewed the policy shift as appropriate. LEADERSHIP Newspapers highlighted that the 350 basis points rate reduction by Central Bank Governor Olayemi Cardoso surprised the financial market. [2][3][4][5]

The Nation Newspaper reported that the fund also urged Nigerian authorities to raise non-oil revenue to strengthen economic stability. Meanwhile, MarketForces Africa reported that the IMF sees an improved growth outlook for Nigeria following the monetary policy adjustment. [3][4]