The Central Bank of Nigeria, CBN, says inflationary level in the country has been moderated due to its continuous hike of the interest rates.
Acting CBN Governor, Folashodun Shonubi made the assertion on Tuesday after the apex bank slightly raised the monetary policy rates by 25 basic points to 18.75 per cent.
Not a few had expected the rates to be reduced in line with President Bola Tinubu’s promise on inauguration day, as part of his administration policy thrust to drive investment and increase consumers’ purchasing power.
“Interest rates need to be reduced to increase investment and consumer purchasing in ways that sustain the economy at a higher level,” Tinubu said on May 29.
Apart from hiking the interest rate, CBN Monetary Policy Committee, MPC also voted to narrow the asymmetric corridor to +100/-300 from +100/-700 and retained the Cash Reserve Ratio, CRR, at 32.5.
Before he was suspended last month as CBN boss, Godwin Emefiele had raised the interest rates in the country to 18.5 percent.
Shonubi who was appointed last month after the suspension of Emefiele, said yesterday during the MPC meeting in Abuja , that inflation has been moderated due to hike in interest.
With Tuesday’s hike, the government bank has increased the rate eight times within one year, raising serious questions on whether the aim of combating the inflation monster has been achieved.
Following yesterday’s hike, analysts watching the CBN insist that the current inflationary problem will get worse, citing the recent removal of fuel subsidy, which has spiked the priceS of goods and services, as reason.
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