May 24, (THEWILL) – The Central Bank of Nigeria (CBN) on Wednesday after the two-day Monetary Policy Committee (MPC) meeting, raised its benchmark interest rate known as the Monetary Policy Rate (MPR), by 50 basis hit 18.5 — the seventh straight time in one year.
It was the last MPC meeting under President Muhammadu Buhari’s administration which ends on May 29, 2023.
This is in consideration of the persistent rising inflation and slowing growth. Nigeria’s inflation accelerated to 22.22 percent in April 2023, and its economic growth slowed to 2.31 percent in the first quarter of 2023, according to the National Bureau of Statistics (NBS).
Godwin Emefiele, governor of the CBN, who disclosed this after the MPC meeting in Abuja said while 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.
The CBN commenced its series of monetary policy stance hikes in May 2022 from 11.5 percent to the current rate.
The MPC also kept unchanged the asymmetric corridor at +100/-700 basis points around the MPR, retained Cash Reserve Ratio (CRR) at 32.5 percent and liquidity ratio at 30 percent.
“Our actions to increase the MPR rates are potent because the inflationary pressures you see today confronting us are a global phenomenon and this started in 2022”, he stated.
In March, the policy-setting committee raised the MPR from 17.5 to 18 per cent in February to tackle inflation. However, despite the continued hike of MPR since last year May, the inflation of Nigeria had increased to 22.22 per cent in April 2023, according to the National Bureau of Statistics.