There are strong indications that the Central Bank of Nigeria (CBN) could raise the nation’s benchmark interest rate as inflation rate heads to a seven-month high.
The apex bank is projected to jettison its hawkish stance and begin a tightening cycle by raising the baseline interest rate in response to spiraling inflationary trend, which is expected to hit a seven-month high at the next announcement.
The National Bureau of Statistics (NBS) is scheduled to release the April 2022 inflation rate ahead of the meeting of the CBN’s Monetary Policy Committee (MPC) on May 23 and 24, 2022.
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The projected headline inflation is said to increase again by 0.28% to 16.2% in the month of April and the continuous rise is likely form a major part of deliberations at the MPC meeting this month as the committee is likely to take the bull by the horn, increasing the MPR by 50bps to 12.0% according to analysts. What is likely to change? That’s the big question.