The Monetary Policy Committee has raised the key lending rate by zero point five percent to 18.5%. It however left the cash reserve requirement and liquidity ratio at 32.5% and 30% respectively.
The apex bank also adds that its consistent rate hikes have helped control inflation which should have risen to about 30.48% in April.
The Monetary policy rate has been consistently raised by the monetary policy committee this year.
It was increased by 1% to 17.5% in January, zero point five percent to 18% in March and now a fifty basis points raise to 18.5% in May.
The committee says holding or loosening is not desirable at this time , hence the need to tighten.
The CBN governor says the current monetary policy stance is moderating inflation and would consolidate existing gains.
He adds that the 22.2% percent inflation rate seen in April would have been 30.48% but for the key lending rates which were raised.
The governor adds that though the tightened monetary policy stance is constraining credits it is a necessary action whose gains would be seen in the long run.
The bank also feels there is a need for the nation to ramp up oil production which presently stands at one point one million barrels per day to the level of OPEC’s quota of 1.8m barrels.
