The Central Bank of Nigeria (CBN) has raised the Monetary Policy Rate (MPR), which measures interest rate, from 18.5 percent to 18.75%.
The Acting CBN Governor, Folashodun Shonubi, disclosed this while reading the communiqué of the fourth MPC meeting of the year on Tuesday.
He said, “In summary, the MPR voted to raise the policy rate by 25 basis points from 18.5 to 18.75 per cent.”
Addressing journalists at the end of the two-day meeting in Abuja, Shonubi said the committee voted to adjust the asymmetric corridor at +100 and -300 basis points around the MPR.
Last week, Nigeria’s headline inflation rose to 22.79% in June from the 22.41% recorded in May 2023 amid soaring food prices and rising cost of transportation occasioned by the removal of subsidy on Premium Motor Spirit known as petrol.
This was according to the latest Consumer Price Index (CPI) report released by the National Bureau of Statistic (NBS). The CPI measures the rate of change in prices of goods and services.
This is the first decision of the monetary committee since President Bola Tinubu’s assumption of office on May 29, 2023.
It is also the first decision of the committee in about a decade without embattled Godwin Emefiele who was suspended as the governor of the apex bank on June 9, 2023.
Analysts’ expectations had been divergent ahead of the first MPC meeting after the suspension of Godwin Emefiele as the governor of the CBN.
The CBN started its monetary policy tightening cycle in May 2022, with its benchmark interest rate rising from 11.5 per cent to 18.5 per cent in May this year.
President Bola Ahmed Tinubu had said interest rates needed to be reduced to increase investment and consumer purchasing in ways that sustain the economy at a higher level.
He also said the volatility around foreign exchange rates would soon normalise.