Nigeria Raises Benchmark Rate First Time Since 2016
By Sahabi Abdul
The Central Bank of Nigeria’s Monetary Policy Committee voted unanimously on Tuesday to raised the benchmark interest rate to 13 percent, the first increase since 2016.
The measure was necessary to slow soaring inflation, which reached 16.82 percent in April, spurred by a rapid depreciation of the naira and rising food and fuel costs, according to Godwin Emefiele, governor of the central bank. All the indices that make up the consumer price index showed increases during the period under review.
“It is quite clear and compelling that attacking inflation is more urgent in the sequence of policy objectives in this regard,” Emefiele said.
After declining steadily for eight months from the peak of 18.17 percent reached in March last year, the annual inflaton figures have now increased for the fifth straight month. The surge in prices meant that the recent monetary policy response of leaving the key rate unchanged was no longer adequate in the face a global inflationary momentum since Russia’s invasion of Ukraine pushed up fuel and food prices, making a rate increase inevitable.