CBN jacks up interest rate to 13.5 per cent

The Central Bank of Nigeria (CBN) has raised interest rate from 11.5 per cent to 13.5 per cent.

CBN Governor, Godwin Emefiele, announced this on Tuesday while addressing the reporters after the Monetary Policy Committee meeting in Abuja.

Emefiele said this while reading the 285th communiqué issued at the end of the apex bank’s Monetary Policy Committee (MPC) meeting on Tuesday.

Mr Emefiele said the committee was faced with various options but guided by the need to slow down inflationary pressure while engendering economic growth.

“Six members voted to raise the MPR by 150 basis points, four members by 100 basis points and one member by 50 basis points.

“Members expressed deep concern about the continued uptrend of inflationary pressure in spite of the gradual improvement in output growth.

“Committee notes that the current rise in inflation is inimical to growth and the full recovery of the Nigerian economy,” he said.

He said that several options were considered before the decision to increase the MPR.

“It is clear and compelling that tackling inflation is more urgent in sequence of policy objectives.

“MPC urged the CBN to double its effort at supporting the priority growth-enhancing sectors of the economy.

“It urged the federal government to do more to provide a safe and secure environment for economic activities to stimulate growth,” he said.

The bank retained the asymmetric corridor at +100/-700 Basic Points around the MPR, the Cash Reserve Ratio (CRR) remained 27.50 per cent, and the Liquidity Ratio, 30.00 per cent.