Monetary Policy Committee of the Central Bank of Nigeria, on Tuesday, raised benchmark interest rate by 400 basis point from 18.5 percent to 22.5 percent.
CBN Governor, Yemi Cardoso made the decision of the meeting, which was the first since his appointment as the apex bank governor, known.
Cardoso said the move was in a bid to tame the stubborn inflation that had not responded much to the previous marginal increase.
The CBN governor said the committee raised the MPR by 400 basis points to 22.75 percent, and adjusted the asymmetric corridor at +100 and -700 basis points from +100 basis points and -300 basis points around the MPR.
He said the committee also increased the Cash Reserve Ratio (CRR) from 32.5 percent to 45 percent, while retaining the liquidity rate at 30 percent.
On inflation, he said the rate of change in prices of goods and services rose to 29.9 percent in January 2024, from 28.92 percent in December 2023.
He attributed the hike in inflation to rising costs of energy, high fiscal deficits and insecurity.