By Kamil Opeyemi
The Central Bank of Nigeria (CBN) has raised the interest rate from 18 percent to 18.5 percent.
The apex bank governor, Godwin Emefiele, announced the decision on Wednesday after the policy-setting committee meeting at the CBN headquarters in Abuja.
Emefiele said the committee members voted to hike the rate by 50 basis points to 18.5 percent, retain the asymmetric corridor at +100 and -700 basis points around the MPR, retain the cash reserve ratio (CRR) at 32.5 percent and liquidity ratio at 30 percent.
“The current trend in price development would
continue to be monitored by the bank with greater collaboration with fiscal authority to address the drivers of inflation,” Emefiele said.
The CBN boss said although the continued rise in headline inflation remained a significant problem confronting the economy, other macroeconomic variables are moving in the right direction despite observed headwinds.
This comes a week after the Nigerian Bureau of Statistics revealed that the country’s inflation rate for the month of April hit 22.22% surpassing last month’s rate of 22.04%.
This marks the third consecutive time the apex bank will be raising the benchmark rate this year.
In January, the CBN raised the interest rate from 16.5% to 17.5 percent to tame inflation.
The MPC raised the monetary policy rate by 100 basis points to 17.5% and kept the asymmetric corridor at +100/-700 basis points around the MPR.
Shortly after the January increase, the CBN again in March increased the benchmark interest rate by 50 basis points to 18. percent.