The Central Bank of Nigeria, CBN, has reviewed the rate at which it lends money to banks from 12.5 to 11.5 per cent.
The reduction follows the 275th Monetary Policy Committee (MPC) meeting on Monday and Tuesday.
Governor of CBN and Chairman of MPC, Mr. Godwin Emefiele, who made the announcement during an online briefing on communiqué of the meeting added that the committee also retained all other policy parameters, except the asymmetric corridor that changed from +200 and -500 basis points to +100 and -700 basis points around the MPR.
The liquidity ratio was left at 30% and Cash Reserve Ratio (CRR) remained at to 27.5%.
Emefiele noted that the decision to reduce the MPR was to sustain ongoing economic recovery efforts and arrest rising inflation.
He proposed that Nigeria will enter a V-shaped recession, meaning it has to be entered into and exited almost immediately.
The implication is that Nigeria will enter recession in the third quarter of this year and there will be growth in the fourth quarter or first quarter of 2021.