Nigeria’s Central Bank hikes prime rate to 14% to curtail inflation
The Central Bank of Nigeria’s MPC has hiked interest rate to 14 percent to curtail inflation.
The move is targeted at curtailing surging inflation uptick. The apex bank raised Monetary Policy Rate (MPR) by 100 basis points to 14 percent, the second straight raise this year.
But it left the Cash Reserve Ratio (CRR) unchanged at 27.5 percent; Liquidity Ratio at 30 percent; and retained the asymmetric corridor of +100/-700 basis points around the MPR.
Nigeria’s inflation rose sharply to 18.6% in June 2022, the highest since January 2017 as prices of both food and non-food items continued in an upward trend.
According to CBN Governor, Godwin Emefiele who announced the decisions of the two days meeting of the Monetary Policy Committee (MPC), the apex bank is seriously worried about rising consumer prices and needed to take a drastic action to reverse it while equally supporting growth recovery.
The announcement was made at 1pm Tuesday.
CBN’s Monetary Policy Committee (MPC) commenced its fourth meeting of the year on Monday in Lagos instead of the Abuja office.
The meeting is coming after the MPC embarked on a retreat at the weekend to appraise its policies in the past.
In its last meeting in May 2022, the CBN raised its benchmark interest rate, known as the Monetary Policy Rate (MPR), by 150 basis points to 13 percent, the first time in six years.
