The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has, again, raised official interest rate known as Monetary Policy Rate by 50 basis points, implying that the interest rate has been raised to 18.5 per cent.
Governor of the Central Bank of Nigeria, Godwin Emefiele, who announced the new decision on Wednesday, said at a media briefing to mark end of a two-day MPC meeting, that 10 members against one voted to increase the MPR, while retaining other rates around the official rates.
“Tightening would reduce pent up aggregate demand which had contributed to high inflation,” Mr Emefiele said as an explanation for further tightening of the rates.
MPC has been increasing rates since May 2022, a reason it attributed to Nigeria’s constant high in demand-pull Inflation. Mr Emefiele said except for interventions by the apex bank through tightening of the interest rate, the headline inflation currently at 22.22 percent would have increased to 30.48 percent.
Emefiele said MPC tightening of the MPR would help in abating security challenges and increasing exchange rate pressures.
MPC explained that headline inflation remain inflation because of scarcity of pms, high price if energy products outside the control of the monetary authorities.
