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Nairaland Forum / Nairaland / General / Politics / CBN Raises Interest Rate (MPR) To 22.75% (17358 Views)
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Re: CBN Raises Interest Rate (MPR) To 22.75% by Easybet1(m): 4:09pm On Feb 27 |
Ok oooo |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Whois(m): 4:10pm On Feb 27 |
More money for loan operators |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Godfullsam(m): 4:10pm On Feb 27 |
Victory662: Lemme try 1. Increase in interest rate will slow down spending thereby reducing the volume of money in circulation. 2. It helps to increase the return (profits) on savings. If you Goan fix your money in the bank, your banks will pay you additional 22.7% of the amount you fixed in the bank after 1 years . 3. It will affect small and medium business aspirants who intend to loan money from the banks to start up their businesses (22.7%) interest rate nobi beans o . 4. It is one of the greatest weapon used by monetary policy makers to fight inflation in any economy. 5. It is beneficiary for those who have enough money to spare (they will be encouraged to save and earn more). But it is big wahala for those who need money to spend ( young business aspirants because they will have to pay more interest for any amount borrowed) and if the business fails, OYO! In the case of our present economic reality, the aim of jacking up the interest rate is to mop up excess money in circulation by encouraging savings and reducing spendings while beating down inflation as much as possible . I have mentioned some advantages and disadvantages for you. Say me thank you 18 Likes |
Re: CBN Raises Interest Rate (MPR) To 22.75% by kokoA(m): 4:10pm On Feb 27 |
Make I no lie. I don't know what this means and how it affects me sha. |
Re: CBN Raises Interest Rate (MPR) To 22.75% by smeag0l(m): 4:14pm On Feb 27 |
This is true. However, the other part you didnt mention is the part thatll cushion the effect of an increased interest rate on the economy. Therell be massive unemployment because businesses will struggle to cope with the high rates of lending, the economy will also contract as a result. Your theory on making bond yields thereby bringing in foreign investors will not happen because givernment has policies that makes it difficult for those guys to repatriate their profits. Lastly, the government needs to stimulate the economy by making electricity stable and cheaper, giving grants to small and medium scale enterprises, tax holidays for companies, fixing the insecurity problem and strengthening our road infrastructureall of which require deliberate investments that i dont see this government making. If they dont do this, any short term gains made by the naira will be lost in the long term. Unless they vontinue raising interest rates indefinitely DeLaRue: 7 Likes |
Re: CBN Raises Interest Rate (MPR) To 22.75% by advanceDNA: 4:14pm On Feb 27 |
Seun: It's a text book move...it sometimes or most times doesn't play out like that especially with a beast-like economy like ours.. By the way.....awon wèrèy wey dey form inflation controllers are no moping money.. They are still printing more and stealing
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Re: CBN Raises Interest Rate (MPR) To 22.75% by AngelicBeing: 4:15pm On Feb 27 |
DeLaRue:Succinctly put and well said, next news jare 2 Likes |
Re: CBN Raises Interest Rate (MPR) To 22.75% by RedpillAnalyst: 4:15pm On Feb 27 |
DeLaRue: Thank you sir. It is 5% ish in North America and people are wailing already. Average Nigerian might not feel that much because we are not heavilyva credit based society where cars, houses and credit cards are loaned. 7 Likes |
Re: CBN Raises Interest Rate (MPR) To 22.75% by aribisala0(m): 4:16pm On Feb 27 |
grandstar:Hopefully it does that Usually when you have a headache paracetamol works. Usually...... |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Slytiger: 4:17pm On Feb 27 |
Bevista:Yes. |
Re: CBN Raises Interest Rate (MPR) To 22.75% by genesishouse: 4:19pm On Feb 27 |
DevilsEqual: Your words in bold agrees to the fact that this has been a useless govt with horrible policy makers all the while, reason we have had it this bad . 1 Like 1 Share |
Re: CBN Raises Interest Rate (MPR) To 22.75% by TemmyT002(m): 4:20pm On Feb 27 |
DevilsEqual: This one doesn't understand what they are saying o. Lol 1 Like |
Re: CBN Raises Interest Rate (MPR) To 22.75% by melodyogonna(m): 4:21pm On Feb 27 |
grandstar:At the cost of massive interest rate. Interest rate is vital for manufacturing, no? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Crvrider: 4:22pm On Feb 27 |
But this will also mean that the banks will increase their rates to borrowing customers and on other financial products. In the long run, if people can't borrow to spend because of the huge interest rates, the economy still suffers for it? What was the old rate? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by papyjaypaul: 4:23pm On Feb 27 |
MPR is 22% but unemployment is 4% Nigeria magic. Let's chop this statistics, we don't need it. 4 Likes |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Victory662(m): 4:24pm On Feb 27 |
Godfullsam:Thank you. You do well |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Daystar7: 4:24pm On Feb 27 |
This is not really a good news, increase in interest rate is bad news for business owners esp the mega business owners that borrow from the banks, Small business owners as well won't see bank loan viable for their business either which means underemployment for some people. High Interest rate don't curb inflation. Nigeria banking system doesn't encourage savings either. What this will do is to decrease demand for goods as people spend less and that in turn will decrease inflation which I don't think will work in this case cos of obvious reasons |
Re: CBN Raises Interest Rate (MPR) To 22.75% by 11doubledee: 4:28pm On Feb 27 |
Victory662:In our own language,this is just to discourage borrowing. This is largely targeted at inflation to reduce the amount of money in circulation. But in realistic terms don't expect any swift turnaround of the economy yet. Going by the amount of basis points increment,it's just a medium term fix from the CBN just to see if inflation will slow down. If it does, good for us. 2 Likes 1 Share |
Re: CBN Raises Interest Rate (MPR) To 22.75% by ceejayluv(m): 4:29pm On Feb 27 |
We're finished |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Octopusssy(f): 4:30pm On Feb 27 |
This reads like Latin to me. Can someone explain what they have done in layman's language? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Coolbadguy: 4:30pm On Feb 27 |
This move indicates a significant tightening of monetary policy, it's likely aimed at addressing inflationary pressures or stabilizing the currency by making borrowing more expensive, thereby reducing consumer spending and inflationary pressures,but it can also have side effect on the economy by slowing down the growth of the economy and which can also increase the prices of goods. Hmmmm i hope they thought about this before increasing MPR by 400bps of 18.75% to 22.75%. 1 Like 1 Share |
Re: CBN Raises Interest Rate (MPR) To 22.75% by ValarDoharis: 4:31pm On Feb 27 |
What of during Obasanjo, Yaradua? nairalanda1: |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Octopusssy(f): 4:32pm On Feb 27 |
omowolewa:So does that mean we won't be able to withdraw cash again from the bank? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Octopusssy(f): 4:34pm On Feb 27 |
Head is paining me with all these technical lingo. I'm out |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Kukutenla: 4:34pm On Feb 27 |
CodeTemplar:I don't see the difference it will make. The banks have not been interested in lending for a while so this is good for them. For the real economy though. It is tales of woe as the manufacturing sector will constrict further. Let's hope it tames inflation though. But is the source of inflation too much money as it is being touted? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by BreconHills(m): 4:34pm On Feb 27 |
Daystar7: If they want to borrow at low rates they can go to an Islamic bank. If they want to raise long capital, they should issue raise it through equity or hybrid issue. There is also still a fair amount of concessional loans out there if they can the narrative rate. Nigerian biz will survive if not thrive. Its who we are. |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Kukutenla: 4:35pm On Feb 27 |
nairalanda1:You think inflation is as a result of budget deficits? |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Crvrider: 4:38pm On Feb 27 |
Octopusssy: The Central Bank of Nigeria raising the Monetary Policy Rate (MPR) to 22.75% means that borrowing costs have increased. This move is often made to control inflation by making it more expensive for banks to borrow money from the central bank, thereby reducing the amount of money in circulation and curbing inflationary pressures. 1 Like |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Validated: 4:38pm On Feb 27 |
Octopusssy:It means that before you borrow to go and do "owambe", you need to think twice and leave borrowing to those who are interested in productivity. Infact, it should hit 30% by Q2. 1 Like |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Gbogbowa: 4:41pm On Feb 27 |
DeLaRue:there is easy solution if they really know what they are doing but they don't want to do it. Emefiele knew he printed money and he needs to mop up the naira before Dec last year to control the effects of the printing but this same people fight that because they want to win election by sharing money unfortunately this is the consequence of that decision |
Re: CBN Raises Interest Rate (MPR) To 22.75% by Oregba87: 4:45pm On Feb 27 |
see below
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Re: CBN Raises Interest Rate (MPR) To 22.75% by kettykin: 4:46pm On Feb 27 |
grandstar: I thought what was driving the cost of goods and services was the continously dropping of naira , will the rate stop naira fall or devaluation or will it make the cost of borrowing the valueless naira very high. 1 Like |
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