Nigeria’s central bank on Tuesday increased the Monetary Policy Rate (MPR), the benchmark interest rate, from 14 percent to 15.5 percent amid rising inflation.
The Central Bank of Nigeria (CBN) raised the interest rate to combat rising inflation in the most populous African country, Godwin Emefiele, governor of the CBN, told reporters at the end of the bank’s Monetary Policy Committee (MPC) meeting in Abuja, the Nigerian capital.
This is the third hike of the MPR, the benchmark interest rate for the country’s financial markets in 2022, said Emefiele.
The MPC also raised the cash reserve ratio to 32.5 percent from 27.5 percent while holding other parameters constant, according to the governor.
“The MPC noted with concern the continued aggressive movement in inflation, even after the rate hike at its meeting in May and July,” he said, adding the move is to restore price stability while providing the necessary support to strengthen the fragile recovery.
Nigeria’s inflation rate reached a 17-year high of 20.52 percent in August.