CBN increases interest rate from 11.5% to 13%

The Central Bank of Nigeria has increased the country’s interest rate for the first time in two years, TopNaija reports.

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has voted unanimously to raise the Monetary Policy Rate (MPR) to 13%.

CBN Governor, Godwin Emefiele made the announcement at the end committee’s meeting at the apex bank’s headquarters in Abuja.

Emefiele justified the increment by saying the MPC suspects “there might be an aggressive accretion of inflation”.

He added that in order to prevent the looming inflation, the MPC had to increase the monetary policy rate by 150 basis points.

The interest on the normal savings account in Nigeria has been stable at 1.25% per annum, improvements are speculated in the near future.

Subsequently, in the wake of the U.S’ decision, the Bank of England increased interest rates from 0.75% to 1% in order to tackle soaring inflation that is expected to rise above 10% in the coming months. The bank also warned that the cost-of living crisis could plunge the economy into recession in 2022.

The monetary policy committee (MPC) voted by a majority to raise its base rate, lifting the cost of borrowing to the highest level in 13 years.