Central Bank of Nigeria Raises Rate 100bps to 7.50%

The Central Bank of Nigeria raised the monetary policy rate 100 basis points to 7.50% from 6.50% previously. The Bank also raised the borrowing and lending rates by 100 basis points to 5.50% and 9.50% while the reserve requirement was left unchanged at 2%. The move was driven by a need to cap-off rising inflation, which was reported at 11.1% in February this year. Referring to the Nigerian government's 2011 expenditure plan of $31.8 billion (up 17% from last year) the Bank governor, Sansui, said: "The fiscal stance is unduly expansionary,"... and there is "serious concern of the heightened inflation risk".

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